News & Insights for the AI Journey|Sunday, June 16, 2019
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SoftBank Invests in Bare Metal Cloud Startup 

Japan's SoftBank Group Corp. continues to invest in enterprise infrastructure developers, leading an early funding round and forming a partnership with bare metal server automation startup Packet.

The partners announced a $9.4 million Series A funding round on Wednesday (Sept. 14) along with a strategic partnership that will bring Packet's bare metal cloud services aimed at developers to the Japanese IT market. Among other things, the goal is to bring infrastructure automation services to private datacenters.

The investment follows SoftBank's (TOKYO: 9984) July acquisition of U.K. chip designer ARM Holdings ((LSE: ARM, NASDAQ: ARMH) for $32 billion. ARM has struggled to make inroads in the x86-dominated server market, and SoftBank's deep pockets and patient capital along with other cloud investments like the Packet partnership could help build a competitive ecosystem.

Founded in 2014, New York-based Packet's technology automates physical servers and networks without virtualization to deliver computing and network resources. The SoftBank investment expands its public cloud datacenter presence that currently includes New Jersey, Sunnyvale, Calif., and Amsterdam.

With the emergence of application container platforms such as Docker and Kubernetes, the container orchestrator, startups like Packet are attempting to gain traction as demand for single-tenant automated datacenter infrastructure is said to be growing.

Since launching its service in August 2015, Packet claims strong demand among application developers as well as users developing on-demand private clouds. It is also attempting to catch the wave of cloud-native applications as new platforms as distributed application platforms are built around Docker containers, Kubernetes cluster orchestrators and the Mesos datacenter operating system.

Along with Docker, Packet is also working with other container infrastructure developers such as CoreOS. Packet's bare metal cloud platform helps automate the CoreOS enterprise Kubernetes distribution released last year called Tectonic.

Along with targeting developers, Packet touts its platform as bringing public cloud automation to tasks such as rapid deployment of bare metal to the physical hardware and network layers. The startup contributes to several open source projects including the Cloud Native Computing Foundation and Memcached, the effort to develop distributed memory object caching system.

How SoftBank's investment in Packet helps the Japanese conglomerate's Internet of Things push remains unclear. The ARM deal was designed to provide SoftBank with the chip technology needed to build out a future network of connected devices and sensors.

About the author: George Leopold

George Leopold has written about science and technology for more than 30 years, focusing on electronics and aerospace technology. He previously served as executive editor of Electronic Engineering Times. Leopold is the author of "Calculated Risk: The Supersonic Life and Times of Gus Grissom" (Purdue University Press, 2016).

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