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Cloud Strategies

Ericsson Acquires Data Center, Industrial IoT Management Startup

Ericsson is adding to its data center and industrial IoT technology portfolio with the acquisition of infrastructure management specialist NodePrime Inc. for an undisclosed cash sum. (See Ericsson to Nab NodePrime.)

The Swedish giant had previously invested in the San Francisco-based 15-person startup, having participated in a $7 million seed funding round in October 2015, along with Menlo Ventures , New Enterprise Associates (NEA) and others.

Now, as Ericsson AB (Nasdaq: ERIC) ramps up its push into the data center technology market, it will add NodePrime's Platform software and 15 staff to its Cloud & IP business unit when the deal closes in about a week's time. The multivendor software tools have been designed for the automated management of data center and Industrial IoT environments, ranging from small test labs to large-scale distributed architectures comprising hundreds of thousands of servers/devices, acting as the centralized "brain" for a software-defined, distributed network.

Those tools are:

  • DataHub: A data collection and analytics system.

  • Directive: Asset discovery, configuration, provisioning and management software that also feeds inventory and network metrics data into DataHub.

  • VDC (Virtual Data Center): A network simulation tool that allows developers and data center managers to plan additions and changes.

    It's not hard to see how such capabilities, if they live up to their billing, could be very attractive to communications networking companies of all types: Large, distributed multivendor architectures are going to proliferate as "cloud" becomes the dominant networking model and data centers increasingly become virtual, distributed entities that incorporate centralized, metro and local (think next-generation central office) facilities.

    DataHub's Platform software is already integrated in Ericsson's Hyperscale Datacenter System (HDS) 8000 platform and is being used by other big names, such as SAP AG (NYSE/Frankfurt: SAP) and web hosting firm GoDaddy. (See Ericsson, Intel Target Telco Data Centers.)

    The key executives at NodePrime, which was founded in 2013, are: CEO and founder James Malachowski, formerly of Dell and Cisco; COO and founder Alex Moore, formerly of social networking software firm Backplane (which was backed by Lady Gaga) and IT software specialist Palantir Technologies; and CTO Bob Bae, formerly of Tachyon Storage and multiple other technology vendors.


    For more data center-related coverage and insights, check out this dedicated content channel here on Light Reading.


    The acquisition is the latest effort by Ericsson to position itself as a leading provider of cloud-enabling technology. Already this year the Swedish vendor has joined the Open Compute Project (OCP), brokered a services development relationship with Amazon Web Services, agreed to form a joint cloud innovation center with Australian operator Telstra and struck a strategic partnership with Taiwanese hardware manufacturer Quanta to drive greater economies from the development of the HDS 8000 platform. (See Ericsson, Amazon Web Services Get Jiggy.)

    It's worth noting that Ericsson's new best buddy, Cisco, is also targeting its efforts at becoming a cloud giant. (See Cisco Builds Its House on the Cloud.)

    While not highlighted by Ericsson in its acquisition announcement, it's worth noting too that NodePrime has also had the Industrial IoT (IIoT) sector in mind when developing its software and that's a market that is set to boom, creating significant opportunities for companies such as Ericsson and Cisco to rival the IT and analytics giants in the battle to become the preferred technology and systems integration partners for large enterprises. (See Industrie 4.0: Rebooting Germany, China's Telcos at Heart of IIoT Plans and US Giants Carve Out Role in the Industrial IoT .)

    For more on Ericsson's cloud/data center developments, see:

    — Ray Le Maistre, Circle me on Google+ Follow me on TwitterVisit my LinkedIn profile, Editor-in-Chief, Light Reading

  • kq4ym 4/15/2016 | 1:54:06 PM
    Re: Ticking a lot of boxes Those employees should be faring well after just a few years of work at the startup. It will be interesting to see the reports later of the purchase price and follow Ericsson's plans to utilize the IoT section as it incorporates the new company into operations.
    Steve Saunders 4/5/2016 | 12:53:40 PM
    Re: Ticking a lot of boxes 15 people? nice deal for the employees at any price, i think 
    [email protected] 4/5/2016 | 10:19:47 AM
    Re: Ticking a lot of boxes It may be disclosed sooner, depending on the value. The deal closes next week. The number will come out at some pint because I can't imagine this is a low number - say, sub-$50M. So hard to tell with data center-related software companies...

    So may be in a filing or at next earnings (which are soon). 
    Steve Saunders 4/5/2016 | 9:37:25 AM
    Re: Ticking a lot of boxes Will the price be disclosed in its next earnings?
    [email protected] 4/5/2016 | 7:36:41 AM
    Ticking a lot of boxes If NodePrime can actually do what it 'says on the tin' at scale and in a mixed, multivendor environment, then this could be a killer acquisition without breaking the bank (though I am guessing at that, as no financial details were disclosed -- of course, there's always the chance this is the 'next Nicira'...)
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