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Equinix, Microsoft Ink Deal

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Global data center service provider Equinix Inc. (EQIX - Free Report) recently announced a strategic alliance with Microsoft Corp. (MSFT - Free Report) . As per the agreement, connectivity to Windows Azure in key markets will now be enabled through Equinix International Business Exchange (IBX) data centers. Financial implications of the alliance were not disclosed.

Windows Azure is a cloud platform that helps users manage applications effectively. Today, there is a great need to develop apps that cater to Windows,  Apple’s (AAPL - Free Report) iOS, Google’s Android operating systems and HTML 5, and Azure has SDKs to support development and add scale on any platform.

Additionally, this offering will help Equinix customers to link their managed infrastructure with Windows Azure through Platform Equinix, thereby enhancing network performance, reducing costs and latency. It will also help Equinix to provide customers with fast and secured cloud-based applications, which in turn will enhance user satisfaction and help Equinix to expand its customer base and market share.

According to a recent survey by Cisco Global Cloud Networking, more than 7 out of 10 respondents felt the need to migrate their company’s network to cloud-based applications. Moreover, it was recognized that the accomplishment of cost savings, flexibility and security, would require enterprises to increase the adoption of cloud-based applications.

Equinix reported revenues of $525.7 million in in the second quarter of 2013, up 15.0% from the year-ago quarter. The company witnessed decent revenue growth across all three geographic regions of the network vertical, especially in the Asia-Pacific.

Equinix, is also renewing its focus on the Asia-Pacific and Japan (APJ) region. However, increasing competition from the likes of AT&T Inc., European exposure and industry consolidation remain headwinds.

Equinix carries a Zacks Rank #4 (Sell).

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