Box: It Makes No Sense For Us To Build Data Centres When IBM Can Do It At Scale

IBM and Box say it makes sense for tech firms to partner with major cloud infrastructure firms rather than build their own data centres because there’s no point in others competing unless they can do so at scale – something very few firms are able to do.

Box will start to let its customers store their data, for regulatory and performance reasons, in parts of IBM Cloud’s network of 46 data centres in 16 countries later this year with the launch of Box Zones.

Aaron Levie, Box CEO, said plans to give users greater control over where their data was stored had been in the works for “two to three years” and that the core box application had to be separated from storage – a complicated process.

Data centre scale

Rather than build its own data centres, he said partnering with bigger firms like IBM was a much more appealing proposition.

“We knew we’d have to do this on the software side, so [thought] ‘let’s not add to the burden with our infrastructure, let’s leverage partners’,” said Levie. “There are now options for software developers dealing with these challenges because there are companies like IBM that have scale.”

“When you get to scale, there’s only a few global players who can [deliver] – IBM, Amazon etc.,” added Robert LeBlanc, senior vice president of IBM Cloud. “HP, Rackspace have got out of the public cloud. It’s not just to expand the data centre, but introduce new technology into the data centre.

“I can keep up because I’ve got to do this at scale, so [Box etc.]. don’t have to keep up with this,” he added, noting IBM was more than capable of doing this for other firms too.

Why still work with AWS?

Box Zones will initially be available Ireland, Germany, Japan and Singapore from May, but will use Amazon Web Services (AWS) data centres. If Box has such a close and productive relationship with IBM, why is it still partnering with AWS and why first?

“Some parts of our architecture have been on AWS over the years,” Levie said in response to TechWeekEurope’s question. “There was already a lot of familiarity with the platform. The partnership we announced with IBM last June encompasses a lot of things as well as cloud.

“We had a bit of headway because of previous work with AWS, but we have a much more significant partnership with IBM.

“We’ve architected Box Zones to be as flexible as possible.”

Levie did not rule out a future partnership with Microsoft and Azure, but said the company would focus on its existing partnerships first.

The first tranche of locations were picked based on the most pressing need – German firms are subject to stringent regulation, while Box is expanding in Europe and Asia. But IBM did say UK firms would be able to store their Box data close to home soon.

“One of the first IBM sites will be London, so a UK IBM customer will be able to [take advantage],” confirmed LeBlanc.

Swings both ways

IBM and Box announced their wide-ranging partnership last year, but Levie was keen to point out that these partnerships were not a one way street and said the willingness of established firms to cooperate rather than enter the market showed the strength of his firm’s prospects.

“We’ve been very focused on growth and our view on what this space is going to look like, that’s funded our sales and marketing spend,” he said. “By the end of this year we expect to be sustainably cash flow positive. We don’t need any outside cash, we raised enough in our IPO.”

“You’re not picking a vendor any more, but an ecosystem and that level of integration is essential,” added LeBlanc. “You’ve got to give the client a choice. We can’t say ‘you’ve got to do it this way’.”

But despite the compliments between the two firms, both Levie and LeBlanc were tight-lipped when asked if IBM was thinking about buying Box.

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