SoftLayer to Expand Nationally with Internap

SoftLayer Technologies will expand its on-demand hosting infrastructure to the East Coast through a five-year, $40 million contract with Internap Network Services (INAP), the two companies announced today. The deal expands on a previous 5-year, $16 million contract for SoftLayer to establish a Seattle data center in Internap's facility in Tukwila, Wash.

"Internap and SoftLayer are bringing to the market a new, tightly coupled managed hosting model that is delivering enterprise-class, large-scale computing by the slice," said Lance Crosby, chief executive officer at SoftLayer. "With Internap we've been able to get to market faster and deliver higher quality solutions that our customers value and are core to their business operations."

SoftLayer, which is based in Plano, Texas and has its primary data center at the Infomart carrier hotel in Dallas, has been one of the fastest-growing hosting providers over the past year. SoftLayer had $33 million in revenue in 2007, up from $13 million in 2006, and now hosts more than 11,000 servers, the company said last month. SoftLayer sold 1,300 servers in January as it mobilized the sales operation for its new Seattle space.

The company launched in 2005 with an innovative "network-in-a-network" design that provides bandwidth to support hosted applications, server-to-server file transfers, load balancing and disaster recovery services.

"SoftLayer and Internap have rapidly and successfully deployed a powerful, on-demand hosting infrastructure to support enterprise applications, rich media and online business," said James P. DeBlasio, chief executive officer at Internap. "The demand for these services has been very strong and is driving us to expand the model across the United States leveraging Internap's network and data center solutions and SoftLayer's innovative Web hosting products, exceptional service delivery and automated operations. Together, we will be able to deliver a robust set of enterprise-class IT solutions to a broader marketplace than ever before."

Internap is in the midst of an active expansion, and plans to add an additional 50,000 square feet of data center space in the first half of 2008, which will allow it to offer more services to its 3,500 customers. Internap provides colocation and intelligent routing services that help bypass Internet congestion points.