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How telcos could conquer the cloud

Cloud computing holds enormous potential for telecom service providers if they get aggressive about driving technological innovation there

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"A telco looking to solve the cloud computing problem makes up a long list of business goals and posts his bill on the door of the cathedral," Nolle said. "Then he waits for vendors to come up and read it and give him the answer to his prayers. Amazon's on the streets preaching. They're solving the problem, not asking someone else to solve it for them. Amazon has broken ground [in cloud computing] with every blessed step they've taken. And every step they took is a step the [telecom] service providers could have taken."

Service provider steps

Verizon Business, which recently expanded its data-center virtualization services in partnership with VMWare, has announced plans to launch its own cloud computing services in June. When it does, it will look to take advantage of its vast network, including dozens of data centers worldwide. It will point to differentiators like security and its long history of managed data networking services. And it will give customers a choice of virtualized or dedicated infrastructure.

"Our approach is to pursue a wide variety of models and fitting those to customers' existing situations, maybe where they already made investments," said Mike Marcellin, Verizon's vice president of global managed solutions. But customer control will be a major part of the offering. "[Customers] will be able to provision their computing resources dynamically. They can turn those facilities up, turn them down, determine how failover can be managed and do so in a model that allows them to only pay for the resources they use on a daily basis."

For the most part, large enterprises still want dedicated infrastructure, but perhaps the most significant opportunity presented by cloud computing is the prospect of providing shared "virtual" resources to a sea of smaller businesses that can't afford the dedicated kind.

Marcellin admits that the telecom sector is playing "catch-up" in the cloud game. But as the space is young and untested, he doesn't necessarily think taking the lead would have been wise, either. "If it was a tradeoff between having a market-leading solution in mid-2009 versus launching a fairly basic solution for Web developers in early '08, I think we made the right choice," he said.

If telcos have waited too long to delve into the cloud, it may be because it's so far been unclear how viable the space will ultimately prove to be. To telcos, the promise of the cloud may sound eerily familiar to those of an entire breed of so-called application service providers, or ASPs, which emerged in the 1990s but failed to achieve the revolution in service delivery they foretold. However, one of the key differences between the 90s and today, several sources point out, is that ASPs were limited by much slower broadband access speeds and other obstacles that no longer exist. On the contrary, cloud computing may be coming along at perhaps the perfect time.

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© 2014 Penton Media Inc.

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