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International Business Machines Corp. (IBM) on Thursday formally launched a set of hardware, software and services designed to make it easier for telecommunications companies to deliver cloud services to their business customers.
IBM's Service Delivery Manager is designed to take advantage of the market for cloud services, which the technology giant estimates will grow to $89 billion by 2015. IBM believes its own revenue opportunity from cloud can grow to $3 billion by that time.
The platform is part of a broader shift by the major technology companies into what the industry sees as the next spark for growth: delivery of traditional IT services over the Internet. Players such as IBM, Hewlett-Packard Co. (HPQ) and Cisco Systems Inc. (CSCO) have struck partnerships and acquired companies to position themselves for this growing opportunity. For IBM, the telcos represent a crucial link in the cloud food chain because they own the physical pipes connecting business customers.
"If you can't connect to the cloud, you can't use it," said Elisabeth Rainge, an analyst at technology research firm IDC.
With the telcos facing slowing revenue from traditional businesses such as data and voice, they are increasingly looking at advanced business offerings such as cloud and managed services as new growth avenues. IBM executives said telcos, though, are unlikely to put the resources behind building their own hardware and software systems.
"Carriers will deliver services, price it and package it. But they won't build their own platform and technology," Scott Stainken, general manager of IBM's global telecommunications business, said in an interview.
Instead, IBM wants the telecommunications providers to turn to its platform. IBM says it can help a telco launch a new cloud service--such as virtual desktop management, storage or hosting--in six weeks, compared with six months if the telco went at it alone. The telcos also have access to IBM's partners, such as Juniper Networks Inc. (JNPR).
The platform comes as major telcos such as AT&T Inc. (T) and BT Group PLC (BT) have made noise about launching their own cloud services. Stainken said he hopes that all of the top carriers take a look at the IBM platform.
France Telecom (FTE, FTE.FR) is using the platform to test out an infrastructure-as-a-service offering for its business customers, which could include acting as a data center. SK Telecom Co. (SKM, 017670.SE) is also testing out the platform for its customers.
The telcos can either offer their own services directly to their business customers or resell IBM-branded services, Stainken said.
While other options exist, IBM is the first to offer cloud services geared for both high-end corporate customers, as well as small and medium businesses, Rainge said, adding that the platform comes with the kind of operational support carriers are looking for.
While IBM offers up its expertise in IT services, it needs the telcos' experience in offering services and a valuable base of business customers.
"There's the computing world and the communication world. You can't have one without the other," she said.
-By Roger Cheng, Dow Jones Newswires; 212-416-2153; email@example.com