Zayo Takes to the Cloud

July 8th, 2015 by · 5 Comments

When Zayo bought Latisys, they acquired more than mere colocation space. They also added some cloud services, and I wondered at the time what the company might have in store for them. Today Zayo started to answer that question as it relaunched those capabilities as part of a larger cloud-services portfolio.

Zayo is now offering private, public, and hybrid infrastructure-as-a-services in both the US and Europe, from security services to performance services to disaster recovery as a service. The combined fiber and data center assets Zayo has assembled via both organic and inorganic means over the past eight years is indeed a powerful platform from which to offer all this. But while they’ve been getting deeper and deeper into the enterprise business for some time, taking on a significant piece of the cloud is a significant evolution for Zayo.

In the past as a private company, Zayo has spun off acquired pieces like managed services and voice in order to keep its focus tight. As a larger, now public company, they have the resources to do more. But it is perhaps the evolution of the platforms underlying the cloud services that have made it possible. Such services have become more centralized at the infrastructure level, and therefore fit much better alongside a fiber and data center operator’s other businesses than they did just a few years ago.

The great thing about moving into cloud services is that the overall opportunity is so much bigger in raw revenue terms.  There’s huge growth available for those who figure out the right business model to address it.  The danger though is that unlike fiber, in which 8 years ago few other than Zayo were ready to invest serious dollars, the cloud has no shortage of people who think they have what it takes and the funding to try it.

With its US footprint now fully national and its fiber consolidation opportunities perhaps less numerous, I have speculated whether Zayo’s rollup interest might be shifting further toward data centers. But with today’s cloud expansion, I have to wonder if they might not be just as interested in rolling up more strategic cloud services assets and technologies. There surely are enough targets out there.

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Categories: Cloud Computing · Metro fiber

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5 Comments So Far

  • Anonymous says:

    I wonder what the value proposition is of a cloud run by a telco? CL made a decent move by acquiring an interesting niche player (though that success is still very TBD), but beyond that, most have been laughable failures.

    Network providers are about the least innovative companies I can think of in the tech space, so it just isn’t in their DNA to figure out how to run fast enough to keep up with someone like AWS or Google Cloud. And if their value prop is “the white glove treatment/personal touch” – it should be noted that this is the value prop of nearly *every* cloud provider that is not AWS. And frequently its code for “we can’t actually do it fast, which is why we talk for so long.”

    Building private or hybrid facilities? Why would I trust a telco over long time experts in that field, other than to give me cheap bw between locations?

  • fiberguy69 says:

    The Value Mr Anonymous is that, Zayo is more than a Telco . It is a modern day telecom with a vast array of services. your old school mind would say something as 90’s as “Telco”.

    • Anonymous says:

      If there is a legit answer or pitch I am actually open to it, if you happen to be an employee.

      I am not picking on Zayo (not a customer at the moment), just your industry. Coming from somewhere that’s probably regarded as more “modern day” than telEcoM, your comment is funny.

      Is it “modern day” telEcoM because you added the letters back in or call it MPLS and Ethernet instead of transport? Because you switched to calling it services instead of products? Because you have a website where I can look at my bill?

      Congratulations. So does Wells Fargo, the stagecoach drivers.

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