UPDATED 20:38 EDT / MARCH 11 2019

APPS

F5 Networks buys NGINX for $670M to move into app delivery services

Network traffic management company F5 Networks Inc. said today it plans to acquire NGINX Inc. in a deal valued at $670 million, part of a bid to capitalize on the popularity of multicloud deployments.

F5 Networks focuses on delivering cloud and security application services. NGINX operates a popular open source web server that powers millions of websites. It also provides load balancing services used to monitor and manage web services centrally across multiple computing environments, plus a variety of application development tools.

NGINX had recently updated its offerings in a major new release that consolidated its application delivery, application programming interface management and service mesh management tools into a single product.

The plan is for F5 to use NGINX’s software to “enable multicloud application services across all environments,” the company said in a statement. It plans to do this by augmenting NGINX’s software with its own security offerings. F5 said it will also integrate its own “cloud-native innovations” to enhance NGINX’s load balancing software.

The NGINX brand will continue to be maintained, and F5 will also continue to support the open source web server project of the same name. NGINX Chief Executive Gus Robertson and co-founders Igor Sysoev and Maxim Konovalov will all remain at the company.

In a blog post, Robertson said the acquisition made sense as the two companies have “complementary strengths” and can enhance each other’s offerings.

“Our web and application server, microservices, and API management solutions complement the application management, application security, and infrastructure security solutions from F5,” Robertson said. “Even in the case of application delivery controllers (ADC) where there is some overlap, NGINX has created a lightweight, software-only version that complements the F5 cloud, virtual, and physical appliance options.”

F5 has made no secret of its desire to get in front of more application workloads. In a recent interview on theCUBE, SiliconANGLE’s mobile livestreaming studio, Calvin Rowland, F5’s senior vice president of business development and public cloud, talked about the company’s plans to release new DevOps tools focused on continuous integration/continuous delivery or CI/CD. The acquisition of NGINX sits well with those plans.

The deal should put F5 in a strong position to deliver application delivery services to developers, said Holger Mueller, principal analyst and vice president of Constellation Research Inc.

“F5 is moving up the stack, away from traditional data transfer, and NGINX is a key step up into application delivery,” Mueller said. “It will be critical for F5 to support NGINX’s roots in open source. Without that the acquisition is of much less value. The next months will show how F5 will be able to pull this feat off, but chances are good.”

Image: F5 Networks

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