Can US telcos deliver their cloud services plans?

Posted By TelecomTV One , 04 September 2009 | 3 Comments | 2 people rated this an average of 4/5

(2)
Tags: Cloud Computing AT&T Verizon

The cloud computing market is exploding and service providers are beefing up their strategies to take a share of turf that was once dominated by big IT suppliers. But are telco providers up for the challenge? Kirk Laughlin reports.

The top five things the large US carriers (basically AT&T and Verizon) have to do to not only roll out enterprise-class cloud computing services – but someday become marketplace titans are:

Fully exploit the innovative capabilities of research facilities like AT&T Labs
Continue investing in the growth of professional services divisions
Understand the business of the customer
Keep the global footprint robust, flexible and world-class
Change your operating culture

At first glance the list probably doesn’t look that daunting. Most Fortune 100 companies know all about investing, innovating and adapting. However, for AT&T and Verizon, companies that have clung tightly to legacy and heritage, adapting and taking a lead role in unfamiliar territory does not come naturally.

This issue is particularly relevant to the fast approach giant-sized market opportunity known as cloud computing. Both AT&T and Verizon are desperately hungry to become major players in offering on-demand IT application and hosting services to enable higher performing computing for corporate customers.

Plenty of observers, myself included, believe that the telcos are actually in a great place to take advantage of the cloud business. They have the network – and particularly the VPN capabilities for reliable transport; they already have relationships in servicing corporate clients and they are quite familiar with a nifty little acronym known as the SLA.

What is troubling, however, are the softer issues in maturing to become less about taking orders, and more about partnering in customizing IT solutions to fit the unique requirements of individual customers.

» This story continues on page 2. Please click here to read

please sign in to rate this article

3 comments (Add Yours) - click here to sign in

(1) 07 September 2009 16:42:40 by David Deans Regarding the security issue -- realise that CIOs have been using off-site data centers for more than four decades. In the beginning it was called Time-Sharing services and more recently Hosting services. Bottom line, the risk is apparently very manageable. Regarding the experience issue -- AT&T, Verizon and BT have long-standing relationships providing managed network services to most of their multinational customers. Managed cloud services is a logical extension of that business model. Regarding the adoption issue -- consider that small businesses are already embracing managed cloud services. In fact, in the Business Technology Roundtable group (on TelecomTV) I just posted a story about an SMB early-adopter. That said, yes, there will be challenges as telcos evolve further into these value-add B2B service offerings. Regardless, the current momentum looks very promising indeed.
(2) 08 September 2009 04:54:10 by Francis McInerney Unquestionably, carriers will not make the grade. Indeed, we have concluded at the Corporate Innovation Project in New York that the dominant clouds will be Apple, Google, and Amazon. None of the carrier investment plans we have been asked to reviewed at CIP are designed to maximize cloud use. Indeed, all carriers, without exception worldwide, have investment plans designed to throttle bandwidth and eliminate clouds from their business plans. The main reason is that carriers have no idea how much money they can make from clouds nor now how clouds can accelerate their days to cash and lessen their working capital loads. So none have plans to adapt their architectures to supporting clouds. Sad, but true. Carrier architectures will be frozen for five years and semi frozen for another five. The cloud business will go elsewhere.
(3) 11 September 2009 15:58:24 by Jim Aimone I agree that the Google/Yahoo of the world will dominate the Cloud Space. What will happen is the Last Mile Service (Broadband)providers will end up partnering with these boys and packaging their content/processing and Apps in with their local content and delivery. Google has the right idea in their OpenEdge approach to Local SP-specifically providing them with a Cache server they can use to aggregate and distribute Googles Apps over their local IP Nets. The local SP will also have a roll to play with select SMB offering them special Back up and Restore Services (from 3rd parties)along with the Cloud apps. Jim A.

(1) 07 September 2009 16:42:40 by David Deans

Regarding the security issue -- realise that CIOs have been using off-site data centers for more than four decades. In the beginning it was called Time-Sharing services and more recently Hosting services. Bottom line, the risk is apparently very manageable.

Regarding the experience issue -- AT&T, Verizon and BT have long-standing relationships providing managed network services to most of their multinational customers. Managed cloud services is a logical extension of that business model.

Regarding the adoption issue -- consider that small businesses are already embracing managed cloud services. In fact, in the Business Technology Roundtable group (on TelecomTV) I just posted a story about an SMB early-adopter.

That said, yes, there will be challenges as telcos evolve further into these value-add B2B service offerings. Regardless, the current momentum looks very promising indeed.

(2) 08 September 2009 04:54:10 by Francis McInerney

Unquestionably, carriers will not make the grade.

Indeed, we have concluded at the Corporate Innovation Project in New York that the dominant clouds will be Apple, Google, and Amazon.

None of the carrier investment plans we have been asked to reviewed at CIP are designed to maximize cloud use. Indeed, all carriers, without exception worldwide, have investment plans designed to throttle bandwidth and eliminate clouds from their business plans.

The main reason is that carriers have no idea how much money they can make from clouds nor now how clouds can accelerate their days to cash and lessen their working capital loads. So none have plans to adapt their architectures to supporting clouds.

Sad, but true.

Carrier architectures will be frozen for five years and semi frozen for another five. The cloud business will go elsewhere.

(3) 11 September 2009 15:58:24 by Jim Aimone

I agree that the Google/Yahoo of the world will dominate the Cloud Space. What will happen is the Last Mile Service (Broadband)providers will end up partnering with these boys and packaging their content/processing and Apps in with their local content and delivery.
Google has the right idea in their OpenEdge approach to Local SP-specifically providing them with a Cache server they can use to aggregate and distribute Googles Apps over their local IP Nets.
The local SP will also have a roll to play with select SMB offering them special Back up and Restore Services (from 3rd parties)along with the Cloud apps.

Jim A.

» TelecomTV One	» Latest Videos	» Viewing TelecomTV Now
» Search	» Latest Events	» Register
» Channels	» Tag Cloud	» Sign out
» Video Playlists	» NewsDesk	» Sign in

» Acision	» ITU
» Alcatel-Lucent	» Juniper Networks
» Cerillion	» Microsoft
» Cisco	» Telco 2.0
» Comverse	» Telcordia
» Green Planet	» TIA
» HP	» Verimatrix