Five out-of-the-box telecom competitors

Category:
Cloud Computing

Competitors:
Google, Yahoo, Amazon, Microsoft

Line of Attack:
While something like cloud computing by definition seems fairly “pie-in-the-sky,” traditional telecom providers would be foolish to sell it short. Cloud computing treats computational resources as a utility available like electricity – you just hit the switch and go. Key capabilities – like storage, processing power and even bandwidth via network meshes – are available as generic resources and distributed application functionality is exposed as services that can be combined and consumed.

Examples of cloud computing capabilities are already available today, including open APIs from Google, Yahoo, Microsoft and Amazon into their distributed services. For instance, Amazon’s EC2 (Elastic Compute Cloud) and S3 (Simple Storage Service) provide centralized processing and storage capabilities for pennies on the dollar. Applications like Google Docs have the potential to move user work onto the cloud as well.

Combine centralized raw resources, distributed application interfaces and smart end-user devices, such as Apple’s iPhone, and you get a next-generation computing infrastructure in which service providers provide on-ramps and not much more.

Analyst and author Nicholas Carr describes it very well: “At this very moment, in a building somewhere in Silicon Valley, I guarantee you that a team of engineers from Google and Apple are designing a set of devices that, hooked up as terminals to Google’s “supercomputer,” will define how we use computers in the future.

Best Defense:
The public telephone network is the original computer in the sky. By providing APIs into key network and call routing capabilities, telecom service providers can become a key cloud computing resource. All the talk about adding service oriented architecture (SOA) and Web 2.0 capabilities to telecom infrastructure are aimed at just this opportunity.

BT is perhaps the best-known practitioner of this approach, with its 21^st Century Network project. Verizon, meanwhile, is speccing out what it is calling application network interfaces to enable access to its network applications layer. Calling it a “huge opportunity,” Verizon CT Mark Wegleitner said the services-based interface represents “an expansion tool for the types of applications you can get from our network.”

The decision for service providers will be just how much access they will provide to their network via the cloud. Building Web service wrappers for their own internal use or for a handpicked set of application partners is one thing. Letting anyone hit the network with application calls is another. But there in lies the potential. For instance, eBay has noted that almost half of their auction listings come via their APIs (rather than directly via eBay.com) while real-time messaging/micro-blogging service Twitter says it generates ten times more traffic from third-party apps built to its APIs than via the service’s own Web site.