CDNs and cloud providers
CDNs and cloud providers are fundamentally IT infrastructure businesses. The ability to deploy storage and networking equipment to your sites all around the world is crucial to the success of your business. In many cases, it’s also a competitive advantage. If one cloud provider can offer its services in Brazil, whereas a competitor can’t, that could be the tipping point for winning over a customer. You also have to constantly maintain and upgrade that infrastructure, often at a whims notice.
If you’re already providing services internationally, it’s likely that you’re leveraging in-market VARs or a traditional logistics company like a FedEx or freight forwarder. These solutions are often costly, slow, and inflexible. You’re limited in your SKUs, your ability to import and export, and will typically have little to zero control over your SLAs. In addition to that, you’re likely having to execute and project manage a lot of the shipments by yourself, which simply adds friction to an already painful process.
Low Volume, High Value, Highly Regulated
Traditional logistics providers weren’t built to solve the infrastructure distribution problem. Freight forwarders, couriers, and hub and spoke carriers provide solutions for solving very high volume, low value, non-regulated shipments. Whereas cloud and CDN companies have the complete opposite requirement! They need to ship IT infrastructure, which is typically low volume (relatively few shipments a month), high value, and heavily regulated.
Although low volume isn’t a “problem” per se, it’s usually more indicative of high importance, especially to cloud companies and CDNs. If hardware needs to be at a data center for a critical deployment, then it needs to be there. It might be one shipment per country, per quarter, but it’s a crucial part of a company’s success. Infrastructure shipments can’t be treated as if they were a shipment of e-commerce or miscellaneous goods. They need focused attention and a fully managed process.
Infrastructure is also high value, which does cause a problem. Higher valued shipments (anything over $2500) are heavily scrutinized by international customs. This raises problems for many teams working for cloud providers and CDNs because they are ill-equipped for managing each country’s regulations and processes. A team may be able to solve the problem for a few easy markets, like in the EU or Canada, but once the company needs to deploy to more difficult markets, like Brazil, Indonesia, India, etc., it becomes an unsolvable problem with internal expertise alone.
Lastly, infrastructure is highly regulated, which causes a lot of problems for traditional logistics providers. Countries all around the world have different regulations and requirements for importing infrastructure. These regulations also change depending on the kind of infrastructure, for example there are different rules regulating the import of network switches versus servers.
In addition, CDNs and cloud providers need to be mindful of international tax, commercialization and compliance regulations, which is often neglected because it becomes secondary to deployment.
This unique mix of requirements makes it difficult for cloud providers and CDNs to rely on traditional logistics providers for help. FGX solves this with our FGX Go service level. FGX’s sole focus is on understanding how to move infrastructure throughout the world’s supply-chain in a fluid and flexible manner. This allows cloud companies and CDNs to focus on product growth, marketing, and maintaining their infrastructure post-deployment.
What is FGX Go?
FGX Go is our turnkey, door-to-data center shipping solution that’s built for companies of all sizes and industries. Whether you’re looking to setup a new data center or ship to an existing PoP, we’ll manage everything from the time you order the equipment from your reseller or OEM to the second it’s delivered to its destination. For cloud companies and CDNs specifically, FGX is also able to help manage through the compliance, tax, and commercialization issues regarding their international infrastructure.
How does FGX Go work?
FGX Go is a service level that enables our clients to obtain quotes on a shipment-by-shipment basis, and doesn’t lock you into any contracts, allowing you flexibility to scale up and down as needed. When we provide our quotes, we’ll also do an import check to make sure that the equipment is eligible for use in the country you’re looking to ship to. We’ll also let you know what we’ll be executing on your behalf (for example, applying for permits, funding international deferment accounts, etc.) and how long it’ll take so that you can plan your deployments in advance.
What’s special about FGX Go is that our quotes take into account your company’s international footprint to look for cost reduction and operational efficiency wherever possible. For example, the reduction or elimination of import VAT in certain countries or the capability to reclaim it in others.
After a shipment’s quote is approved, FGX will prepare all of the documentation and licenses, perform all of the necessary compliance work, fund duties and taxes, etc., prior to anything being shipped out. By doing so, we limit the amount of time your hardware is sitting in international customs, thus reducing uncertainty and risk in the process. Once all of the documentation and pre-shipment work have been approved, your equipment will be routed via our private supply-chain to its destination’s port of entry, where our in-house customs brokers take over.
During customs clearance, officials may inquire about the import by asking questions, requesting backup documentation, and more – all of which FGX will manage on your behalf. After customs clearance has been completed, we’ll arrange for the shipment to be delivered via a direct drive to the data center or colocation site and provide you with a POD (proof of delivery).
How much work will I have to do?
As little as possible. There are, however, situations where our clients want to commercialize their shipments in a specific way and in order for FGX to make that happen, we have to work with their international counterparts. In cases like that, our clients have to do a bit of administrative and communication work, but throughout the entire process, FGX acts as the project manager and takes ownership over moving things forward. But in 99% of shipments, FGX is able to manage all of the shipments with zero end-user interaction.