Telcos shift into cloud service providers

John Eng
31 May 2011
Daily News

There can be no doubt that cloud computing is the new gold rush of the 21st century, and it will define the IT landscape for at least the next decade. What started more than 10 years ago as an experiment in selling software-as-a-service is now turning into a full-blown activity for service providers to offer their services and solutions under the cloud umbrella.

The diversity of participants in the cloud computing phenomenon is an indication of the potential the technology has to change the way consumers and companies use the cloud to innovate. What was once the exclusive domain of technology companies has become a free-for-all, with newcomers announcing their offerings. From hosted service providers to software developers and to system integrators, most are throwing their weight on the cloud vision.

Even traditional communications service providers (CSPs) like telecom vendors, cable service operators and IP service providers have been pushing their way into the market with their cloud offerings.

According to Ovum, major telcos have an important part to play in promoting the awareness and understanding of cloud computing, and bringing enterprise-grade cloud computing solutions to a broader base of users. Telcos also have a unique opportunity to position cloud computing as an extension of their managed networking solutions (such as MPLS-based VPNS), by offering 'on-net' cloud computing capabilities backed up by end-to-end service level agreements.

The industry believes that CSPs are well-suited to deliver cloud-like services to the market as they are already carrying the most sensitive data on their networks and understand the burden/control regulators place on data traffic. In addition, they also have the right framework and cloud merely adds another layer on top of that. CSPs are used to delivering on service levels and they understand the security requirements for data traveling through the network.

However, that additional layer is not as simple as the industry is led to believe. Cloud-based services are complex because they are an amalgamation of hundreds or even thousands of components. For example, a business-class e-mail service requires additional services like anti-spam, anti-virus, archiving and web-access functionality. But these alone are not sufficient to make it a true full-service offering.

The service must also include the capability to deliver such offerings with flexibility and completeness. Only through the integration of disparate technologies and services can it be deemed a full service. How a service brings all of these together seamlessly can help differentiate itself from the competition.

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