Amazon Doesn’t Worry This Cloud Startup

About four years ago, twin brothers Jacob and Zachary Smith decided they would start a cloud infrastructure company. To many people in the industry that may have sounded like a fool’s errand. How can a startup possibly survive, let alone compete, in a market dominated by Amazon Web Services?

But AWS or Microsoft Azure’s cookie-cutter servers and cloud VMs wouldn’t be a perfect fit for every company and every application, the founders of New York-based Packet thought. There’s still a market for customized computing infrastructure, and with edge computing on the rise, they expect, that market will be growing.

The basic question, Jacob Smith said, was, “Are there 1,000 or 2,000 companies in the world that are going to do it their way? And if so, how can we as an industry – we’re talking ODMs and OEMs, and data center real estate people, and everything else – work together to deliver that experience in an awesome way. Because if it’s not awesome, they won’t buy it.”

SoftBank and Dell Technologies-backed Packet wants to be less like an AWS – a vertically integrated giant that does everything on its own, from designing infrastructure in its data centers to building and selling developer tools – and more like a Ritz-Carlton, which provides a brand and an experience but doesn’t deal with owning real estate or building hotels.

In Smith’s perfect world, Packet would be a software company, working together with data center providers and hardware suppliers to provide customers the computing capacity they need, where and when they need it. That means Packet wouldn’t have to try to outspend the likes of AWS, Azure, or Google Cloud Platform, who have all been investing billions of dollars a year in building out their cloud infrastructure.

We interviewed Jacob Smith, Packet’s senior VP of engagement, for the latest episode of The Data Center Podcast, in which we asked him about the company’s business model, its recent project to launch an edge computing cloud service for 5G applications, and why he isn’t worried about AWS.

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