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What’s Next for Bare-Metal-as-a-Service After Equinix Metal’s Closure?
As Equinix Metal faces a planned shutdown, questions arise about the viability of Bare-Metal-as-a-Service (BMaaS) in a cloud-dominated market.
5 Min Read
Bare-Metal-as-a-Service: A niche in the IaaS market facing new challenges as Equinix plans to sunset its Metal platformImage: Alamy
When Equinix, one of the world’s largest data center providers, spent more than $330 million to purchase Packet in 2020, the future seemed bright for Bare-Metal-as-a-Service (BMaaS).
Packet specialized in providing BMaaS in the form of on-demand dedicated servers – a service that offered businesses a high degree of control over data center hardware without requiring them to purchase and maintain servers themselves.
Equinix turned Packet into an offering called Equinix Metal, which customers could use to launch dedicated servers almost instantaneously inside Equinix data centers.
Now, just a half-decade later, it has been announced that Equinix will sunset Metal by 2026 and, by all indications, exit the BMaaS market. The notion that one “can’t kill the Metal” (as Data Center Knowledge put it in a 2022 headline) turned out to be wrong.
Given that such a prominent BMaaS offering – and one that reflected enormous investment by Equinix – proved to be short-lived, the question has now become: Does BMaaS have a future, or is the upcoming closing of Equinix Metal proof that the public cloud hyperscalers won, and almost no one will pay for dedicated servers anymore? Here’s some perspective on those questions.
Why did Equinix End Metal?
Equinix hasn’t publicly shared details about why it chose to spin down Metal. But the obvious conclusion is that the service was simply not as profitable as the operator had hoped.
This seems especially likely given that Equinix announced the sunsetting of Metal just five years after acquiring Packet – which is not a particularly long time to confirm the market viability of a new type of offering.
Equinix was reported last year to be winding down its Metal BMaaS offering, with a planned closure by 2026 (Image: Alamy)
Also notable is that Equinix has posted strong financial results recently, suggesting that it likely could have afforded to continue offering Metal if it expected the service to become sufficiently profitable eventually.
The fact that the company instead is shutting Metal down would seem to be an indication that the server business fell far short of hitting the numbers that Equinix had hoped for, leading the company to make a speedy exit from the space.
But again, this interpretation is speculative, since Equinix has said little about the rationale behind the discontinuation of Metal.
Bare-Metal-as-a-Service Adoption Challenges
The bigger story here isn’t about Equinix or Metal specifically. It’s about Bare-Metal-as-a-Service as a whole and what the impending closure of Metal portends for BMaaS’s future.
BMaaS is a type of Infrastructure-as-a-Service (IaaS) offering that allows customers to deploy dedicated servers on-demand. In contrast, most other types of IaaS – such as cloud server hosting services like Amazon EC2 – primarily offer access only to shared infrastructure.
Effectively, BMaaS provides customers with the simplicity of the public cloud (because they don’t have to purchase and manage their own servers), while simultaneously offering the control that comes with running workloads on dedicated, bare-metal hardware. It’s a best-of-both-worlds type of solution.
But BMaaS can also be a challenging solution to adopt due to factors such as:
The expense of BMaaS servers, which could cost many times what you’d pay for a conventional cloud server with similar specs.
The difficulty of finding BMaaS providers, especially now that Equinix (one of the only global BMaaS providers) is leaving the market.
The fact that with BMaaS, you don’t have direct access to your servers – so although they are “dedicated” to your sole use, you can’t do all the things you’d be able to do if they were your own servers living in your own data center.
In short, the level of control that BMaaS offers may not always outweigh the high cost of BMaaS services. These are some the potential reasons why Metal didn’t catch on to the extent Equinix hoped.
The Future of Bare Metal-as-a-Service
For businesses that do see value in BMaaS, the good news is that there remain plenty of companies that offer this type of IaaS solution.
Most are smaller providers that specialize in bare-metal or dedicated server hosting, but a few large IaaS companies (including Rackspace) continue to operate BMaaS offerings.
You can also rent dedicated server instances from public cloud providers, like Amazon Web Services (AWS) and Microsoft Azure. These typically don’t offer as much control as you’d get from a platform that specializes in BMaaS, but they’re an easily accessible option – and are likely to be particularly attractive for businesses that already use the same platforms to host virtual, non-dedicated cloud servers.
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It’s hard to imagine any of these services going away anytime soon. Metal’s closure was possibly the result of an overestimation of the extent of demand for BMaaS services, but this doesn’t mean that there is no customer base for smaller-scale BMaaS offerings.
Ultimately, while public clouds will almost certainly continue to dominate the IaaS market, the sunsetting of Metal doesn’t shouldn’t be interpreted as a sign that BMaaS as a whole has no future, or that the public cloud hyperscalers have definitively out-competed platforms seeking to challenge the shared-infrastructure approach to IaaS. It just means that Equinix’s Metal gamble didn’t pay off.
Disclosure: I have conducted some consulting work for Equinix Metal in the past, but I have no insider knowledge regarding the state of Metal’s operations or Equinix’s decision to deprecate the service.
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