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Rapidly growing DigitalOcean opens second NYC data center

DigitalOcean has amassed more than 35,000 customers since its launch in 2011, and has taken residency in Google's New York City facility

By Joab Jackson
August 2, 2013 05:44 PM ET

IDG News Service - Continuing its rapid expansion, cloud service provider DigitalOcean has opened a second facility in the greater New York metropolitan area -- a data center located in Google's gargantuan Manhattan facility.

The additional location is another sign of the fast-growing success the company has had in offering a low-cost, easy-to-use IaaS (infrastructure as a service).

"There's a huge market for developers out there who just want a server online as fast as possible, and that is what DigitalOcean provides," said Mitch Wainer, a co-founder and the chief marketing officer of DigitalOcean.

Although Wainer disputed that DigitalOcean's first New York City-area data facility, actually located in northern New Jersey, ran out of space, new users who have signed up in the past month or so were instructed that they could not host their accounts there, and were instructed to choose DigitalOcean's outlets in Amsterdam or San Francisco.

DigitalOcean's rapid growth, as measured by Netcraft

In any case, the company's user base is growing quickly. The company has accrued more than 35,000 customers since its launch in 2011, and its revenue is increasing by about 30 percent to 50 percent per month, Wainer said.

Internet service market analysis firm Netcraft noted that in June 2013 DigitalOcean had more than 7,000 Web-facing servers, a dramatic increase from the prior December when Netcraft counted only 100 DigitalOcean Web-facing servers.

This newest set of servers is being colocated with the Telx data center company, which leases space in Google's 3 million-square-foot building. The building takes up an entire block on 8th Avenue, in the Chelsea district of Manhattan.

DigitalOcean was founded with the idea of offering cloud hosting that would be easier to set up than what was offered by the market leader, Amazon Web Services (AWS).

"There was a huge void in the market," Wainer said. Amazon and Rackspace are focused on enterprise-scaled businesses, but businesses in the lower-tier to midlevel market, which don't require advanced feature sets and don't have full engineering teams to manage infrastructure, are completely ignored, he said.

With its wide range of services, Amazon Web Services recently launched a series of tutorials that can guide users into setting up virtual machines.

In contrast, DigitalOcean keeps its deployment options relatively simple -- and inexpensive. Accounts are billed either on a monthly or an hourly basis. The least expensive "droplet," which is what DigitalOcean calls a virtual machine, costs US$5 a month, or about $0.007 cents per minute, and features a single CPU core between 2GHz and 3GHz, 512MB of working memory, 20GB of storage and 1 terabyte of data transfers.

In contrast, the least expensive month-to-month option on AWS, a T1.micro image running Linux, would run about $14.96 per month, and does not come with any storage.

Reprinted with permission from Story copyright 2014 International Data Group. All rights reserved.
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