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Telstra invests in NGINX web server

The web server providing services for companies such as Netflix, Instagram, Airbnb, and Pinterest has been bolstered by an investment from Telstra Ventures.
Written by Corinne Reichert, Contributor

Telstra's venture capital arm Telstra Ventures has invested an undisclosed amount in United States web server provider NGINX, boosting the company's ability to expand throughout the APAC region.

According to Mark Sherman, managing director of Telstra Ventures, Telstra eyed the investment as an opportunity to expand its provision of application delivery and deployment services.

"When you look under the hood of many of the most popular websites around the world today, you find NGINX's technology. This business continues to grow their share of the web server market and has compelling value-add propositions to sell," Sherman said.

"NGINX provides a popular application delivery platform, which is renowned for its load-balancing capabilities, high performance, security, and scale, and is in use on more than 140 million sites worldwide. They consistently deliver improved capabilities and performance for video-heavy sites, and sites experiencing high traffic volumes.

"We are looking forward to working closely with NGINX to improving our customer experience and help our users embrace more software-defined application services."

In return, NGINX said it is using the investment as an opportunity to bring its app development, deployment, and maintenance tools to more companies -- particularly media, entertainment, and ecommerce websites -- across the Asia-Pacific region.

"We see Telstra as an important partner in expanding our market reach to new geographies," said NGINX CEO Gus Robertson.

"Telstra has an extensive customer footprint, both in Australia and across Asia-Pacific. We are looking forward to working with them to bring our technology solutions to companies across the region."

Telstra has been investing more in US companies of late; in January, it similarly invested in Palo Alto, California-based application delivery services provider Instart Logic. More than 500 websites currently make use of Instart Logic's application delivery service, with users in the US, Canada, and the UK.

Telstra also invested $270 million in Silicon Valley-based video-streaming and analytics company Ooyala, taking control of the company in the process in August 2014. This was followed in September by Telstra contributing to a $50 million Series D funding round for ecommerce platform Bigcommerce, and joining a number of other backers in a funding round for DocuSign, an electronic signatures company.

In the APAC region, on the other hand, Telstra last week pulled AU$2.1 billion worth of investment out of China when it entered an agreement to sell 47.7 percent of total shares in Chinese online company Autohome at a price of $29.55 per share.

Telstra also sold off Pacnet's Singaporean and Thai ISP assets for AU$4.4 million to a Singaporean cloud and datacentre company in November, as well as backing out of a $1 billion wireless joint venture in the Philippines with Filipino giant San Miguel Corporation last month.

Telstra CEO Andrew Penn said that the telco will, however, continue eyeing opportunities for Asian expansion.

"We continue to pursue growth opportunities in Asia, consistent with our strategy," Penn said.

"Following our April 2015 acquisition of Pacnet, Telstra is now one of the largest connectivity providers in Asia.

"Our investment decisions will be guided by our capital management framework. Investments remain an important part of our future to ensure sustainable growth in earnings and shareholder returns over time."

Telstra acquired Pacnet for $697 million in December 2014.

In January, Telstra acquired Kloud, which provides professional and managed cloud services to enterprises for more than 80 corporate and government customers across the Asia-Pacific region, and invested in Chinese cloud services company Qiniu.

Telstra Ventures also made a multimillion-dollar investment in Taiwanese video big data and analytics company Gorilla Technology Group in March 2015, saying the company could provide beneficial video analytic software solutions for the government, security, broadcast, and retail sectors.

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