Why acquire Linonde when you are going to throw away everything which makes Linode valuable? Wouldn't it be cheaper to just create a cloud computing offering from scratch?
In the medium run (first 2-5 years) it’s not cheaper.
In the short run? Buying Linode gave them a foothold in the market. Creating it from scratch, would have taken months (or even years) to be able to make the first offer, and years until they built a reputation that would attract customers.
But they are starting with a customer base, some of which have been with Linode for over a decade. Way easier and faster to build reputation from that as a starting point. (And also already cash flow positive and profitable, ignoring the purchase=setup cost)
Exactly, we are happy client for more than 14 years. And don't plan to move if they keep what Linode was good at. I mean when it is setup, except extremely rare migrations, you forget about it.
Yeah, but that's the big if, isn't it? Once they enact changes which require action on your part (sunsetting services, changing prices, ...), you'll probably move, or at least seriously consider it.
I think that's a lot of the point here. They won't be starting with that customer base if most of that customer base leaves because of these changes (which I think a significant portion of them may).
Yes, as I recall, when Rackspace ruined Slicehost, a lot of people moved to Linode. I am guessing the same thing is likely to happen to Linode now. I'm just not sure if there is as clear a choice for a new company as it seemed to be when a lot of people moved from Slicehost to Linode.
I think these acquisitions are partly about the customer base and infrastructure but I believe a big part is getting the staff - existing functional highly skilled.
My guess is their organic growth rate wasn't impressive and so this change, which is only changing the name, isn't throwing away the most valuable part of Linode. The staff, operations routines and their technology are the most valuable parts. Even though they may not be using brand recognition to pitch this to their corporate sales contracts, I have a feeling its going to get mentioned as a counter to any concerns about new or immature offerings.
* already existing SOPs and MOPs. Way easier to integrate or copy something that works than building it from scratch
* already existing systems -- ordering gear is still weeks or months out for us, plus no need to engineer or setup a new system as above, way easier to integrate or copy than starting from zero (in a business sense, anyway)
