IBM to Help Telcos Become Cloud Providers

With a package of products and services, IBM is hoping to help telcos offer cloud services to enterprises.

By Nancy Gohring
Thu, October 14, 2010

IDG News Service — With a package of products and services, IBM (IBM) is hoping to help telcos offer cloud services to enterprises.

IBM is offering telecom service providers the hardware, software and services required to deliver a wide range of cloud offerings to business customers. The operators can decide to build and manage the platform internally, or pay IBM to do so on their behalf.

The IBM Cloud Service Provider Platform includes IBM's Integrated Service Management Platform, which includes the Tivoli Netcool network and service assurance portfolio. The platform offers service management, network monitoring, security, storage, service-level-agreement management, and usage and accounting management.

With the platform, telcos can offer enterprises infrastructure-as-a-service as well as applications-as-a-service from a range of companies. "A lot of our competitors are offering a narrow set of services like unified communications or storage," said Craig Wilson, vice president of sales for IBM's Global Telecom Industry group. IBM, however, hopes to make its platform open to as many application providers as are interested.

Initially, companies including Broadsoft, Corent, deCarta, Jamcracker, Juniper Networks (JNPR), Netapp (NTAP), Openet Rightscale and Wavemaker say they'll integrate their applications into the platform so that operators can offer them to enterprise customers.

This offering from IBM is "quite clearly the most comprehensive," said Elisabeth Rainge, an analyst with IDC. She would expect other suppliers to try to match the breadth and depth of IBM's offer, but for now, none other compares, she said.

France Telecom (FTE), Shanghai Telecom and SK Telecom have all been piloting the IBM Cloud Service Provider Platform. France Telecom's Orange Business Services unit is using it to offer IaaS to business customers.

Enterprises are increasingly looking to telcos, with whom they already may have a long-term relationship, for cloud services. A recent Yankee Group study that looked specifically at the IaaS market found that 33 percent of early adopters of those services said that they turn to telecom companies first for IaaS services.

Yankee Group also found that while telecom providers are well-positioned to snare IaaS market share, they've been slow to come out with many offerings beyond basic backup and storage systems.

IBM thinks that's about to change.

"The service providers have the potential to be really successful in this market," said IBM's Wilson. Telcos currently offer telecom services to government agencies, small to medium-size businesses and corporations. "The telcos are desperate to find new business models and new source of revenue so they are embracing this cloud opportunity like no other opportunity I've seen them embrace in the last 15 years."

Nancy Gohring covers mobile phones and cloud computing for The IDG News Service. Follow Nancy on Twitter at @idgnancy. Nancy's e-mail address is Nancy_Gohring@idg.com

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