Telecom service providers often talk about cloud computing services as if they're a well-established entity with enterprise customers, but as with all things cloud, there's a lot of hype surrounding the truth. The truth? Carriers say one thing and enterprises say another. In short, carriers are going to have to work hard to show enterprises they're up to the cloud challenge, if indeed that's what they're selling.
SearchTelecom.com executive editor Kate Gerwig talked to ACG Research Managing Partner Ray Mota, who discussed the five benefits of cloud computing services for telecom carriers in his most recent column.
How difficult is it for telecom carriers to sell cloud computing services to large enterprises?
Mota: Some years ago, the carriers did a lousy job of supporting multiple protocols and implementing a lot of security features. So stemming from that, there was a total lack of trust in them. Now that's changed somewhat. The economy has forced some enterprises to outsource more and rely more on advanced technology. For carriers, now that IP has won the protocol war, they have one protocol to support, and if they're using MPLS, there's better provisioning and security, too.
Also, it's much more profitable for carriers to offer Ethernet services compared with Sonet or TDM, even though at first they thought Ethernet services were a joke. Now that Ethernet is carrier grade, it's a lot easier to deploy. With IP, Carrier Ethernet, and the economy putting pressure on enterprise IT budgets, it all came together for the carriers.
Can telecom providers compete against Amazon's Elastic Compute Cloud (EC2) service?
Mota: Amazon is doing an amazing job on the cloud side, but if you look at pure managed services -- managing your VPN and that type of thing -- there's been a tremendous increase with providers being able to offer managed CPE devices, and so on.
Carriers like BT have said they're not just going to manage the pipe, but will manage some of what's going through the pipe and offer end-to-end security and end-to-end VPN solutions. They've done pretty well with that, which has even helped router and switch sales. But carriers have to market their services better. If you're a CIO, are you going to trust a book company or let someone like an AT&T work out the scalability?