Cloud Computing, Part 1: Clearing the Air

Defining Cloud Computing and What it Means for Service Providers

Carriers Flying in the Cloud

But while most can agree the basic idea of cloud computing entails providing businesses with remotely located computing power, definitions vary wildly when one moves beyond that core principle. For instance, Microsoft, as noted, includes services as part of its cloud offer. Others define cloud computing as replicating hardware servers as software-based sessions. Some say cloud computing is synonymous with hosted applications and SaaS. And others emphasize it’s really all about offering anywhere/anytime access to applications and services on any device. Some say it’s not cloud computing unless it’s accessed over the Internet (rather than a private connection). In fact, the only thing that’s a constant is a general insistence that cloud computing, whatever it is, will be a force in the market.

So, beyond the Microsoft thing, where do carriers fit into all this?

For XO Communications-owned Concentric, cloud computing is a real competitive opportunity to take the XO network footprint and combine it with remote computing infrastructure.

“We are out to declare the war on beige,” said Bill Uyeki, senior product line manager at Concentric, referring to those beige data servers from the 1990s. “Let’s get it out of the closet and into the cloud.

“Now we can really go into the IT closet and leverage the network and offer this in a secure way,” he added.

Meanwhile, incumbents like AT&T Inc. (T) and Verizon Communications Inc. (VZ) are approaching cloud computing more cautiously.

Verizon, for one, is in the process of developing its cloud computing offering and has scheduled a beta phase of the service to launch this quarter. A commercial launch is anticipated by the end of the second.

“We’re going after mid-to-large enterprises with a multitiered architecture,” explained Chris Gesell, director of IT solutions global product marketing for Verizon Business. “We’ll follow our normal contracting procedure, but once they’re ramped on, they’ll have the portal to control themselves how much computing power they have delivered.... This is a disruptive event, a new delivery model, to be added to the managed and hosted flavors of infrastructure. This is something new: it’s an on-demand cloud.”

The on-demand aspect makes it appropriate for ad hoc use — a prime selling point for service providers selling cloud computing. “What I think is driving this for enterprises is capex and opex savings,” said Mike Capuano, director of the service provider routing and switching marketing group at Cisco Systems Inc. (CSCO). “The choice is taking 10 IT guys to cable and [configuring] a bank of servers for a project, or, you can just go to a Web interface and ask for 30 virtual machines and be off and running. This reduces the operational costs and adds flexibility because you have a sort of storage and compute playground where you can go try stuff quickly for competitive advantage.”

AT&T can offer a real-life example of the ad-hoc opportunity. “We have the Synaptic hosting service, which will be the core platform for our future cloud services,” explained Greg Sexton, director of product development at USi, which is an AT&T subsidiary. “The U.S. Olympic Committee used it in Beijing. Whereas they traditionally go out and buy infrastructure to support the event, we were able to put them on our platform, which is a shared platform with a pay-as-you-go format, and that completely changed their MO in how they use infrastructure and lowered their costs. It’s a new way to solve business challenges.” AT&T expects to offer commercialized cloud services in the coming months.

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