Data Center Finance: Amazon Buys Startup Annapurna Labs

Data Center Finance: Amazon Buys Startup Annapurna Labs

After nearly a year of looking for the right startup to partner with, Amazon announced in mid-January that it has purchased Israeli data center company Annapurna Labs.

The startup has been very secretive about its operations, but it has been reported that the company is creating a communications system and processing platform for data centers

The little known chip firm was privately owned by entrepreneur Avigdor Willenz and has been operating mostly under the radar since 2011. After selling Galileo to Marvell Technologies for nearly $3 billion in 2000, Willenz became one of the most successful semiconductor entrepreneurs in Israel.

Amazon acquired Annapurna Labs for a reported $350 million. The deal will likely be an asset to Amazon as it continues to expand its Web Services offerings and searches for a faster and more efficient infrastructure. The tech giant has been looking for an Israeli company to acquire for some time now, opening an office in the country last year to work with companies of all sizes that utilize AWS.

“AWS started out as infrastructure storage, but we have moved on,” said Amazon CTO Werner Voegels. “Many of our clients use relational databases, open source technology, data services, and security services. Our objectives are to scale with good performance and add services, reducing costs for us, which we can pass on to our customers.”

Voegels added that to accomplish this goal, the company would have to start to dramatically increasing its own development, focusing on both hardware and software. Partnering with a firm like Annapurna Labs will allow Amazon to have all of the capabilities necessary to create new products and services.

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