Oracle buys high-profile Dyn provider in hopes of bypassing Amazon in the cloud market

Oracle continues to grow in the cloud services market. It is known that the founder of the company Larry Ellison wants to shift Amazon from the position of a leader in this market.

The next step in the fight against a competitor was the purchase of the American DNS provider Dyn. This will allow the company to expand the reach of its cloud solutions. On the sale of Dyn became known on Monday, November 21.
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Fortune journalist Dan Prymak suggested that this is a sum of exceeding $ 600 million. According to a Fortune source close to the deal, Oracle will pay for this purchase from $ 600 to $ 700 million.

The publication notes that in its history Dyn has attracted no more than $ 100 million investment. Not only Oracle claimed to buy Dyn: IBM was also interested in this company, an informed source told Fortune.

Dyn has over 3,500 corporate clients, including Netflix, Twitter, Pfizer and CNBC.
“Oracle receives the most important unit for building its infrastructure as a service (IaaS) in the form of DNS, load balancing, content delivery and monitoring. This will make it possible to increase confidence in the Oracle cloud infrastructure overnight, ”said independent IT consultant, IHAN, Janakiram.

Dyn's purchase will enable Oracle to offer customers packages of services that combine IaaS (“infrastructure as a service”) and PaaS (“platform as a service”). In addition, Oracle customers will have access to Dyn tools to monitor the performance of the Internet.

On October 21, 2016, the Dyn DNS servers were subjected to a massive DDoS attack, denying users access to popular resources like Twitter, Amazon, PayPal, and Netflix. A total of 85 known sites were unavailable or intermittent.

The power of the cyber attack was 1 Tb / s. The damage from the attack is estimated at $ 110 million. The hacker groups RedCult and New World Hackers assumed responsibility for its implementation. A distinctive feature of this DDoS-attack was the use of botnets created from equipment in the field of “Internet of things”.

Dyn is an American company that monitors Internet performance, optimizes online infrastructure, and provides domain registration and postal services. The company was founded in 2005 and is based in Manchester, New Hampshire.

Initially, Jeremy Hitchcock and his cofounder Tom Daly launched Dyn as a free open source project. At that time, they were still studying at the Polytechnic Institute of the City of Worcester.
Hitchcock and Daley put the server right in the dorm room. When they had difficulties with money, the project was on the verge of closure.

“We placed [on the project website] a button“ donate ”, but not a lot of money was received. Then we told the users that if they did not give us $ 25 thousand in a week, we would close. [After that] we received $ 40,000, ”Hitchcock told Business Insider.

Oracle Ambitions in the Cloud Market

In September 2016, Larry Ellison announced the creation of a second-generation IaaS data centers at Oracle and announced that Amazon’s leadership in the cloud market is coming to an end . The company's goal is to offer Oracle customers a package of services where IaaS, PaaS and SaaS (“software as a service”) will be combined.

Amazon's reign came to an end. In the future, he will face serious competition. Our Generation2 IaaS solutions offer 2 times more processing power, 2 times more RAM, 2 times more storage and 10 times more I / O resources, and 20% less than Amazon Web Services. IaaS (Infrastructure-As-A-Service) is a great opportunity for Oracle to add cloud infrastructure to our fast-growing SaaS and PaaS businesses.

In addition to Amazon, Oracle’s rivals in the cloud market are Microsoft, IBM and Google. Each of these companies has a much larger market share. By the end of 2015, Amazon controlled 31% of the market, Microsoft - 9%, IBM - 7%, Google - 4%, and Oracle did not even enter the top five. However, the company shows rapid growth: in the first fiscal quarter of 2017, sales of SaaS and PaaS grew by 82%.

Buying a business off the shelf can help Oracle quickly catch up with competitors. In particular, this month the company received the approval of the required number of shareholders of the cloud provider NetSuite for its purchase for $ 9.3 billion.