Cloud Computing: The Telco Opportunity

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Clou

d

Compu

ti

ng

The Telco Opportunity

Telecom & Media Insights

Issue 57

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reeing up budget, and improving IT productivity and responsiveness. Theimproving IT productivity and responsiveness. The rising interest in cloud computing has resulted in several telcos entering this rising interest in cloud computing has resulted in several telcos entering this space. Although operators have been late

space. Although operators have been late entrants, they have established a entrants, they have established a strongstrong presence by leveraging their in-place assets and ocusing aggressively in this presence by leveraging their in-place assets and ocusing aggressively in this market. The primary ocus o telcos has

market. The primary ocus o telcos has been on IaaSbeen on IaaS22_{, even i many also provide}_{, even i many also provide}

signicant SaaS

signicant SaaS33_{applications. However, PaaS}_{applications. However, PaaS}44_{has been largely neglected by most}_{has been largely neglected by most}

operators. Our analysis indicates that cloud

operators. Our analysis indicates that cloud computing presents several attractivecomputing presents several attractive commercial opportunities or telcos which should be tapped in a phased manner, commercial opportunities or telcos which should be tapped in a phased manner, without delay, in order to maximize returns. Although the IaaS proposition would without delay, in order to maximize returns. Although the IaaS proposition would be most ruitul or operators, other opportunities across SaaS, service delivery be most ruitul or operators, other opportunities across SaaS, service delivery innovation, and PaaS will also oer signicant potential. We recommend that innovation, and PaaS will also oer signicant potential. We recommend that telcos dierentia

telcos dierentiate themselves by oering niche te themselves by oering niche services which require industryservices which require industry and region specic customization. For example, a strong ocus on specic industry and region specic customization. For example, a strong ocus on specic industry verticals such as nance and healthcare will help them gain an edge over

verticals such as nance and healthcare will help them gain an edge over thethe competition. In terms o service delivery, telcos are best equipped to adopt virtual competition. In terms o service delivery, telcos are best equipped to adopt virtual private cloud deployments and broker approach

private cloud deployments and broker approach55_{. Customized oerings or}_{. Customized oerings or large}_large

enterprises and SMEs

enterprises and SMEs66_{will urther strengthen their position and enable them to}_{will urther strengthen their position and enable them to}

become rontrunners in cloud

become rontrunners in cloud computing.computing.

1 Abstract

1

1 Chief Chief Information Information Officer.Officer.

2

2 Infrastructure Infrastructure as as a a Service.Service.

3

3 Software Software as as a a Service.Service.

4

4 Platform Platform as as a a Service.Service.

5

5 A broker is A broker is the single point of the single point of contact for an enterprise for all cloud contact for an enterprise for all cloud computing requirements such as servicecomputing requirements such as service

provisioning, service level agreements (SLA) and complianc

provisioning, service level agreements (SLA) and compliance. A broker sits between the enterprise and multiplee. A broker sits between the enterprise and multiple

cloud service vendors and provides a layer of abstrac

cloud service vendors and provides a layer of abstraction.tion.

6

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Cloud computing is the latest technology trend in which IT

Cloud computing is the latest technology trend in which IT inrastructurinrastructure ande and sotware programs are accessed over the Internet or

sotware programs are accessed over the Internet or private networks. Cloudprivate networks. Cloud oerings can be largely categorized as Sotware as a Service (SaaS), Platorm as a oerings can be largely categorized as Sotware as a Service (SaaS), Platorm as a Service (PaaS), and Inrastructure as a Service (IaaS) (see Figure 1). These

Service (PaaS), and Inrastructure as a Service (IaaS) (see Figure 1). These servicesservices are delivered via three main models: public cloud

are delivered via three main models: public cloud77_{, private cloud}_{, private cloud}88_{, and hybrid}_{, and hybrid}

cloud cloud99_._.

Enterprises o all sizes are being increasingly drawn to cloud computing. Benets Enterprises o all sizes are being increasingly drawn to cloud computing. Benets such as reduced IT costs, pay-per-use, better resource utilization, and elastic such as reduced IT costs, pay-per-use, better resource utilization, and elastic scalability ar

scalability are driving its uptake. e driving its uptake. The percentaThe percentage o CIOs interested in cloudge o CIOs interested in cloud computing has grown rapidly rom 5% in 2009 to 37%

computing has grown rapidly rom 5% in 2009 to 37% in early 2010in early 20101010_{. The rising}_{. The rising}

interest in these services is driving increased enterprise spending, and as a result, interest in these services is driving increased enterprise spending, and as a result, cloud computing presents an attractive revenue potential or technology

cloud computing presents an attractive revenue potential or technology playersplayers and telcos alike.

and telcos alike.

While the benets o cloud computing make it attractive or customers, concerns While the benets o cloud computing make it attractive or customers, concerns

such as data security, privacy, and compliance have slowed down the pace o such as data security, privacy, and compliance have slowed down the pace o adoption. For instance, strict privacy laws that place limits on the movement adoption. For instance, strict privacy laws that place limits on the movement o inormation beyond the borders o the European Union, have hindered the o inormation beyond the borders o the European Union, have hindered the evolution o cloud computing in Europe.

evolution o cloud computing in Europe.



 Software applications running on aSoftware applications running on a

Cloud infrastructure Cloud infrastructure 

 Applications are accessible throughApplications are accessible through

a thin client interface such as a thin client interface such as webweb browser

browser



 Delivering storage, computing,Delivering storage, computing,

monitoring and backup services monitoring and backup services from the cloud

from the cloud 

 Companies can manage their Companies can manage their

infrastructure remotely infrastructure remotely SaaS Offerings SaaS Offerings IaaS Offerings IaaS Offerings Application Application runtime runtime environment environment Web servers Web servers Databases Databases Applications

Applications End-user applicationsEnd-user applications_{available through}_{available through}

Internet Internet

The Cloud The Cloud

Stack of Cloud Services Stack of Cloud Services

Service Catalog, Service Catalog, component library component library

Monitoring and management of: Monitoring and management of: -- Services & Resources - Services & Resources - Virtual

- Virtual servers (Virtualization)servers (Virtualization) - Physical servers - Physical servers (Datacenters) (Datacenters) Virtual Virtual Infrastructure Infrastructure Application Application Development Development Environment Environment 

 Applications built using toolsApplications built using tools

supported by the provider supported by the provider 

 Clients have control over theClients have control over the

application hosting environment application hosting environment

PaaS Offerings PaaS Offerings

Source: Capgemini TME Strategy Lab Analysis Source: Capgemini TME Strategy Lab Analysis

7

7 Public cloud Public cloud services are delivered to services are delivered to multiple customers from multiple customers from third party data centers third party data centers over the over the Internet.Internet.

8

8 Private cloud Private cloud is deployed is deployed within an within an enterprise for its enterprise for its internal use.internal use.

9

9 In a In a hybrid cloud hybrid cloud model, some model, some resources are provisioned resources are provisioned and managed in-house wand managed in-house while others arehile others are

delivered from the cloud.

10

10 Harvard Business ReviewHarvard Business Review,,What What We’re Watching in Cloud We’re Watching in Cloud ComputingComputing, , http://hbr.org/20http://hbr.org/2010/06/what-

10/06/what-were-watching-in-cloud-computing/ar/1.

were-watching-in-cloud-computing/ar/1.

2 Introduction

Figure 1: Categorization o Cloud Computing Oerings

Ater careully weighing the benets and risks o cloud computing, several Ater careully weighing the benets and risks o cloud computing, several

operators have advanced into this lucrative market. However, the key challenge operators have advanced into this lucrative market. However, the key challenge ahead or these operators is to

ahead or these operators is to dierentidierentiate themselves in this highly competitiveate themselves in this highly competitive arena. In this paper, we take a close look at the cloud computing space, qualiy the arena. In this paper, we take a close look at the cloud computing space, qualiy the opportunity or telcos, and

opportunity or telcos, and propose some recommendations around how operatorspropose some recommendations around how operators can maximize the opportunity in

can maximize the opportunity in this market.this market.

Given the revenue

potential, telcos should not

not delay their entry in the

cloud computing space

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Worldwide IT cloud services revenues are expected to grow rapidly at a CAGR Worldwide IT cloud services revenues are expected to grow rapidly at a CAGR 1111

o 26% rom 2009 to 2013 to

o 26% rom 2009 to 2013 to reach US$44.2 billion. While SaaS will continuereach US$44.2 billion. While SaaS will continue to contribute the highest to the overall revenue, its share is

to contribute the highest to the overall revenue, its share is expected to decline,expected to decline, largely due to an increased enterprise ocus on IaaS (see Figure 2).

largely due to an increased enterprise ocus on IaaS (see Figure 2). The rapidThe rapid growth o IaaS will be uelled by a keen interest rom businesses on curbing the growth o IaaS will be uelled by a keen interest rom businesses on curbing the huge costs associated with IT

huge costs associated with IT inrastructureinrastructure..

Several companies are competing aggressively to grab the

Several companies are competing aggressively to grab the largest share o thelargest share o the lucrative cloud comput

lucrative cloud computing market. ing market. These players all largely under one o theseThese players all largely under one o these three categorie

three categories: enablers, vendors, or service providers (see Figure 3). s: enablers, vendors, or service providers (see Figure 3). The role o The role o some mature players, however, can also span a

some mature players, however, can also span a number o categories. For number o categories. For instance,instance, both Cisco and IBM are cloud enablers as

both Cisco and IBM are cloud enablers as well as CSVswell as CSVs1212_._. Source: Capgemini TME Strategy Lab Analysis; Forrester Research; Cloud Computing 2010,

Source: Capgemini TME Strategy Lab Analysis; Forrester Research; Cloud Computing 2010, An An IDC IDC UpdateUpdate, September, September 2009

2009

11

11 Compound Annual Growth Compound Annual Growth Rate.Rate.

12

12 Cloud Service Cloud Service Vendors.Vendors.

3

3 Marke

Marke

t

Dy

nam

ics

x% x% CAGRCAGR 69% 69% 10% 10% 21% 21% 58% 58% 13% 13% 29% 29% 21% 21% 35% 35% 37% 37% $17.4 $17.4 billion billion $44.2 $44.2 billion billion Figure 2:

Figure 2: Worldwide IT Worldwide IT Cloud Services Cloud Services Revenue Revenue (US$Bn) and (US$Bn) and Growth Rate byGrowth Rate by

Service Type

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Leading technology vendors such as

Leading technology vendors such as Amazon, SalesorceAmazon, Salesorce.com, and Microsot have.com, and Microsot have established a rm ooting in this market and oer a

established a rm ooting in this market and oer a range o services spanningrange o services spanning SaaS, PaaS, and IaaS (see Figure 4). In terms o revenues, the current CSV SaaS, PaaS, and IaaS (see Figure 4). In terms o revenues, the current CSV landscape is dominated by players

landscape is dominated by players such as Salesorce.com, Amazon, and Oracle.such as Salesorce.com, Amazon, and Oracle. Salesorce

Salesorce.com, the leading provider o .com, the leading provider o SaaS CRMSaaS CRM1313_{solutions, reported revenues}_{solutions, reported revenues}

o over

o over US$1billionUS$1billion1414 _{in 2009, which is the highest}_{in 2009, which is the highest amongst CSVs. The success o}_{amongst CSVs. The success o}

these leaders can be attributed to

these leaders can be attributed to their technical prowess, early mover advantage,their technical prowess, early mover advantage, and the strong ocus on cloud

and the strong ocus on cloud computing.computing.

Though large technology players have emerged as

Though large technology players have emerged as leaders in cloud computing,leaders in cloud computing, several smaller companies such as Rackspace and Netsuite are trying to carve their several smaller companies such as Rackspace and Netsuite are trying to carve their niche. Telcos such as BT and AT&T have also entered this market. In the next niche. Telcos such as BT and AT&T have also entered this market. In the next section, we will evaluate the

section, we will evaluate the cloud computing initiatives and strategies o cloud computing initiatives and strategies o telcos.telcos.

13 Customer Relationship Management.

14

14 Company Websites; Company Websites; Annual Report.Annual Report.

Source: Capgemini TME Strategy Lab Analysis;

Source: Capgemini TME Strategy Lab Analysis; Company WebsitesCompany Websites

Service Providers Service Providers Cloud Service Cloud Service Vendors (CSVs) Vendors (CSVs) Cloud Enablers Cloud Enablers 

 Provide cloud focusedProvide cloud focused business consulting, and business consulting, and technology services such as technology services such as system integration, cloud system integration, cloud migration, and maintenance migration, and maintenance



 Provide the actual cloudProvide the actual cloud services, spanning SaaS, services, spanning SaaS, PaaS and IaaS, to customers PaaS and IaaS, to customers



 Provide the Provide the technologytechnology,, infrastructure , platforms, and infrastructure , platforms, and middleware to enable the middleware to enable the provision of cloud services provision of cloud services

Examples

Examples Software Software (SaaS)(SaaS)

Application Application Development Development Platform (PaaS) Platform (PaaS) Servers Storage Servers Storage Oracle on Demand Oracle on Demand __ __ __ __ Cisco Webex Cisco Webex __ __ __ __ Salesforce CRM Salesforce CRM __ __ __ __

IBM Lotus Live

IBM Lotus Live __ __ __ __

Salesforce Force.com

Salesforce Force.com __ __ __ __

Google App Engine

Google App Engine __ __ __ __

Microsoft Azure

Microsoft Azure __ __ __ __

Amazon Web Services

Amazon Web Services __ __ __ __

BT

BT __ __ __ __

Orange Business Services

Orange Business Services __ __ __ __

AT&T AT&T __ __ __ __ GoGrid GoGrid __ __ __ __ Rackspace Rackspace __ __ __ __ EMC MozyEnterprise EMC MozyEnterprise     Nirvanix CloudNAS Nirvanix CloudNAS __ __ __ __

Figure 3: Stakeholders in the Cloud Computing Ecosystem

Figure 4: Enterprise Cloud Oerings o Select Vendors

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Compared to market leaders such as Amazon and Salesorce.com, telco entry Compared to market leaders such as Amazon and Salesorce.com, telco entry into cloud computing has

into cloud computing has been reasonably late. While Salesorce.com startedbeen reasonably late. While Salesorce.com started oering services in 1999, BT and T-Systems, one o the earliest telcos to oer cloud oering services in 1999, BT and T-Systems, one o the earliest telcos to oer cloud solutions, entered only in the 2003 to 2004 timerame (see Figure 5). Despite the solutions, entered only in the 2003 to 2004 timerame (see Figure 5). Despite the late start, several telcos such as BT, AT&T, and Verizon are competing aggressively late start, several telcos such as BT, AT&T, and Verizon are competing aggressively with market leaders to establish a strong oothold. The majority o operators have with market leaders to establish a strong oothold. The majority o operators have taken the role o a CSV while a ew such as Verizon also act as service providers. taken the role o a CSV while a ew such as Verizon also act as service providers. This section presents an overview o key

This section presents an overview o key telco strategies in cloud computing.telco strategies in cloud computing.

Target Segment Target Segment

The cloud computing oerings o

The cloud computing oerings o most telcos are targeted towards the enterprisemost telcos are targeted towards the enterprise segment. Enterprises and governments spend nearly

segment. Enterprises and governments spend nearly US$2.4 trillion worldwideUS$2.4 trillion worldwide1515

on IT products and services, many o

on IT products and services, many o which can be delivered rom the cloud. Thiswhich can be delivered rom the cloud. This high revenue potential makes the segment attractive or

high revenue potential makes the segment attractive or operators. Moreoveroperators. Moreover, the, the consumer cloud space is

consumer cloud space is nascent and the revenue opportunities limited.nascent and the revenue opportunities limited. Within the enterprise segment telcos are aggressively targeting SMEs due Within the enterprise segment telcos are aggressively targeting SMEs due toto

the growing interest in this

the growing interest in this segment or cloud-delivered sotware. SME sharesegment or cloud-delivered sotware. SME share in overall cloud services revenue is expected to increase rom 25% to 40% in overall cloud services revenue is expected to increase rom 25% to 40% between 2009 and 2015

between 2009 and 20151616_{. To benet rom this opportunity, several telcos oer}_{. To benet rom this opportunity, several telcos oer}

services customize

services customized to ulll SME needs. d to ulll SME needs. For instance, “IT PlaFor instance, “IT Plan” rom Orange isn” rom Orange is a packaged SaaS solution oering a suite o oce productivity, messaging, and a packaged SaaS solution oering a suite o oce productivity, messaging, and business applications targeted at SMEs.

business applications targeted at SMEs.

15 Forrester Research,

15 Forrester Research,The Evolution Of Cloud Computing MarketsThe Evolution Of Cloud Computing Markets, July 6, 2010., July 6, 2010.

16

16 Capgemini TME Strategy Lab Analysis; Analysis MCapgemini TME Strategy Lab Analysis; Analysis Mason,ason,Seize the US$35.6 billion global market for Seize the US$35.6 billion global market for enterprise cloud services

enterprise cloud services, June 2010., June 2010.

4

4 T

T

elco

Activ

ity

in

Cloud

Computing

Source: Capgemini TME Strategy Lab

Source: Capgemini TME Strategy Lab Analysis; Company WebsitesAnalysis; Company Websites Note: Deutsche T

Note: Deutsche Telekom spun off from Zimory elekom spun off from Zimory as an independent subsidiary as an independent subsidiary in November 2007in November 2007

2003-2004 2003-2004 2007-2008 2007-2008 2009-2010 2009-2010 PlannedPlanned SaaS SaaS PaaS PaaS IaaS IaaS BT Open BT Open Orchard Orchard T-Systems T-Systems Dynamic Dynamic Services Services Telstra Telstra T-Suite T-Suite NTT Biz NTT Biz Security Security Telefónica Telefónica Aplicateca Aplicateca AT&T AT&T Synaptic Synaptic Hosting Hosting Deutsche Deutsche Telekom Telekom Zimory* Zimory* Orange IT Orange IT Plan Plan Orange Orange Flexible Flexible Computing Computing Verizon Verizon Computing as a Computing as a Service Service SK Telecom Cloud SK Telecom Cloud Computing Platform Computing Platform T-Systems (Database and

T-Systems (Database and Middleware Environments) Middleware Environments) BT Virtual BT Virtual Data Center Data Center AT&T Synaptic AT&T Synaptic Storage and Storage and Compute Compute AT&T AT&T Telstra Telstra Telecom Italia Telecom Italia TeliaSonera Business Class

TeliaSonera Business Class Cloud Services

Cloud Services

NTT NTT

Figure 5: Select Examples o Telco Foray into Cloud Computing

Several telcos have

entered the cloud

computing market with

IaaS as their agship

oering and a strong ocus

on the enterprise segment

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Service Offerings Service Offerings

Telco oerings in cloud computing are centered around IaaS and SaaS with limited Telco oerings in cloud computing are centered around IaaS and SaaS with limited ocus on PaaS (see Figure 6).

ocus on PaaS (see Figure 6). IaaS is the fagship oering o IaaS is the fagship oering o most operators, andmost operators, and in general SaaS has taken a backseat compared to IaaS primarily because telco in general SaaS has taken a backseat compared to IaaS primarily because telco capabilities and experiences are more aligned towards delivering IaaS.

capabilities and experiences are more aligned towards delivering IaaS. In 2008, AT&T made its debut in

In 2008, AT&T made its debut in IaaS with its IaaS with its Synaptic Hosting proposition. SinceSynaptic Hosting proposition. Since then, several leading operators such as

then, several leading operators such as BT (Virtual Data Center), Orange (FlexibleBT (Virtual Data Center), Orange (Flexible Computing), Verizon (Computing as a Service), and Deutsche Telekom (Zimory) Computing), Verizon (Computing as a Service), and Deutsche Telekom (Zimory) have ollowed suit. In act, the current IaaS oerings o

have ollowed suit. In act, the current IaaS oerings o most operators are asmost operators are as competitive as those rom established players like Amazon

competitive as those rom established players like Amazon and Rackspace. Overand Rackspace. Over the next ew years, all major telcos plan to

the next ew years, all major telcos plan to ocus most on IaaS ocus most on IaaS in order to addressin order to address the growing enterprise demand or cloud

the growing enterprise demand or cloud inrastructurinrastructure services.e services.

Although IaaS has captured most o the operators’ attention, SaaS too has garnered Although IaaS has captured most o the operators’ attention, SaaS too has garnered

signicant interest

signicant interest. Many telcos oer a . Many telcos oer a host o SaaS applications, usually inhost o SaaS applications, usually in partnership with ISVs

partnership with ISVs1717_{, or accomplishing a range o}_{, or accomplishing a range o business tasks. For example,}_{business tasks. For example,}

BT oers multiple CRM solutions

BT oers multiple CRM solutions in partnership with Salesorce.com and Netsuite,in partnership with Salesorce.com and Netsuite, NTT has recently launched a cloud-based security solution, and T-System delivers NTT has recently launched a cloud-based security solution, and T-System delivers SAP rom the cloud.

SAP rom the cloud. CommunicatCommunication and collaboration sotware such as ion and collaboration sotware such as hostedhosted PBX

PBX1818_{, messaging, email, conerencing, and team collaboration solutions are}_{, messaging, email, conerencing, and team collaboration solutions are}_the_the

mainstay o SaaS oerings rom

mainstay o SaaS oerings rom leading operators.leading operators.

Telcos have traditionally stayed away rom PaaS, largely due to its unattractiveness Telcos have traditionally stayed away rom PaaS, largely due to its unattractiveness both in terms o revenue and demand, when compared to IaaS and

both in terms o revenue and demand, when compared to IaaS and SaaS. ApartSaaS. Apart rom T-Systems, which oers database and middleware environment to nearly rom T-Systems, which oers database and middleware environment to nearly 300

3001919_{customers, ew operators have shown signicant interest in this category.}_{customers, ew operators have shown signicant interest in this category.}

In addition to SaaS, PaaS, and IaaS some telcos such as Verizon, Orange and BT In addition to SaaS, PaaS, and IaaS some telcos such as Verizon, Orange and BT also oer proessional services, helping customers identiy

also oer proessional services, helping customers identiy and migrate the rightand migrate the right applications to the cloud.

applications to the cloud.

Telcos

Telcos SaaS SaaS IaaS IaaS PaaSPaaS

BT

BT   

Orange Business Services

Orange Business Services __ __ __

Deutsche Telekom/T-Systems Deutsche Telekom/T-Systems __ __ __ TeliaSonera TeliaSonera __ __ __ Belgacom Belgacom __ __ __ Telefónica Telefónica __ __ __ AT&T AT&T __ __  (Planned) (Planned) Verizon Business Verizon Business __ __ __ Telstra Telstra __ __  (Planned) (Planned) SK Telecom SK Telecom __ __ __ NTT NTT __ __ __ Bharti Airtel Bharti Airtel __ __ __ Tata Comm Tata Comm __ __ __

Figure 6: Categorization o Cloud Oerings rom Telcos

17

17 Independent Software VendorIndependent Software Vendor..

18

18 Private Private Branch Exchange.Branch Exchange.

19 Forrester Research,

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Entry Strategy Entry Strategy

Partnership with technology players has been the oremost entry strategy o Partnership with technology players has been the oremost entry strategy o telcos in cloud computing. Operators have partnered with a range o vendors telcos in cloud computing. Operators have partnered with a range o vendors rom hardwar

rom hardware providers such as HP and e providers such as HP and Sun to virtualization specialists such asSun to virtualization specialists such as VMware and Citrix Systems. These partnerships have helped

VMware and Citrix Systems. These partnerships have helped telcos signicantlytelcos signicantly reduce their time-to-market and minimize the risks associated with developing reduce their time-to-market and minimize the risks associated with developing complex technical capabilities in-house.

complex technical capabilities in-house. In addition to

In addition to partnerships, a ew operators have partnerships, a ew operators have acquired technology companiesacquired technology companies to leverage their expertise to launch cloud services. For instance, AT&T acquired to leverage their expertise to launch cloud services. For instance, AT&T acquired leading application services provider USInternetworkin

leading application services provider USInternetworking (USi) g (USi) in 2006 or in 2006 or US$300US$300 million to develop capabilities in delivering on-demand

million to develop capabilities in delivering on-demand services and managedservices and managed enterprise sotware solutions. Similarly, telcos such as BT, Verizon and T-Systems enterprise sotware solutions. Similarly, telcos such as BT, Verizon and T-Systems also acquired companies to develop expertise in

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Cloud computing presents several opportuniti

Cloud computing presents several opportunities or telcos to es or telcos to pursue (seepursue (see Figure 7). Analysts estimate that by 2015, telcos will have a 23%

Figure 7). Analysts estimate that by 2015, telcos will have a 23%2020_{share in the}_{share in the}

overall cloud services market. overall cloud services market.

Operator success in the cloud,

Operator success in the cloud, howeverhowever, will depend , will depend largely on selecting the rightlargely on selecting the right choice o services to

choice o services to launch. Tlaunch. Telcos should consider a elcos should consider a combination o actorscombination o actors such as the attractiveness

such as the attractiveness2121_{o a service, its complexity, and the expertise required}_{o a service, its complexity, and the expertise required}

to launch beore

to launch beore determining the services to oer. determining the services to oer. Most importantly, Most importantly, operatorsoperators should ocus on those services

should ocus on those services or which they are well positioned to or which they are well positioned to oer byoer by leveraging their existing capabilities such as data

leveraging their existing capabilities such as data center expertise, managedcenter expertise, managed service experienc

service experience, and global ootprint. e, and global ootprint. Based on this rationale, the most relevanBased on this rationale, the most relevantt commerc

commercial opportunities or telcos ial opportunities or telcos can be categorized into three dierent servicecan be categorized into three dierent service buckets:

buckets: low hanging ruits, the next phase, and the uture (see Figure 8). In orderlow hanging ruits, the next phase, and the uture (see Figure 8). In order to make the most o

to make the most o these opportunities, telcos should launch these oerings in athese opportunities, telcos should launch these oerings in a phased manner

phased manner, starting with , starting with the low hanging the low hanging ruits rst.ruits rst.

20 Analysis Mason,

20 Analysis Mason,Seize the US$35.6 billion global market for enterprise cloud servicesSeize the US$35.6 billion global market for enterprise cloud services, June 2010., June 2010.

21

21 Service attractiveness is a combination of customer Service attractiveness is a combination of customer demand and revenue potential.demand and revenue potential.

5

5 Attract

Attract

ive

Opportu

nities

fo

r

Telcos in Cloud Computing

Source: Capgemini TME Strategy Lab Analysis; Forrester, Future View:

Source: Capgemini TME Strategy Lab Analysis; Forrester, Future View: The New Tech Ecosystems of Cloud, CloudThe New Tech Ecosystems of Cloud, Cloud Services, And Cloud Computing

Services, And Cloud Computing, August 2008, August 2008

SaaS SaaS PaaS PaaS I I a a a a S S E E n n a a b b l l e e m m e e n n t t a a n n d d P P r r o o f f e e s s s s i

i o o n n

a a l l S S e e r r v v i

i c c e e

s

s Content ManagementContent Management Communication and Collaboration Communication and Collaboration

CRM CRM ERP SCM ERP SCM

Business

Business Intelligence Intelligence Digital Digital Content Content CreationCreation Document Management Document Management Billing Billing Desktop Productivity Desktop Productivity Cloud Universe Cloud Universe Compute on Demand Compute on Demand Storage on Demand Storage on Demand Hosting on Demand Hosting on Demand Virtual Servers Virtual Servers Backup Services Backup Services Testing and Testing and Development Development Service Management Service Management Network Assets Network Assets

Application Development Environment Application Development Environment

Database Database App Server

App Server

Integration

Integration Object Object Data Data StoresStores

Message Queues Message Queues Middleware Middleware Consulting Consulting Disaster Recovery Disaster Recovery Security Security

Maintenance and Support Maintenance and Support

System Integration System Integration Cloud Broker Cloud Broker Wholesale Capacity Wholesale Capacity White label Services White label Services

Figure 7: Universe o Potential Cloud Services

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In the subsequent subsections we

In the subsequent subsections we will detail the three service will detail the three service buckets.buckets. Low Hanging Fruits

Low Hanging Fruits

These are the services which provide an

These are the services which provide an immediate attractimmediate attractive opportunity or telcosive opportunity or telcos and should be launched rst. Not only

and should be launched rst. Not only do these services have a do these services have a high demand andhigh demand and revenue potential but also existing telco strengths are

revenue potential but also existing telco strengths are well aligned to well aligned to deliver themdeliver them rapidly. Hosting on-demand, SaaS enablement, and storage and computing

rapidly. Hosting on-demand, SaaS enablement, and storage and computing on-demand all under this category.

on-demand all under this category. Hosting on Demand

Hosting on Demand

Telcos are already procient at providing managed hosting services or enterprises. Telcos are already procient at providing managed hosting services or enterprises. In collaboration with technology partners, operators can rapidly

In collaboration with technology partners, operators can rapidly virtualize theirvirtualize their existing data center inrastructure, without excessive cost overheads, to oer existing data center inrastructure, without excessive cost overheads, to oer on-demand hosting. Some operators such as AT&T and Orange already provide this demand hosting. Some operators such as AT&T and Orange already provide this service. Service delivery through the cloud will not only

service. Service delivery through the cloud will not only result in the optimizationresult in the optimization o telcos’ existing inrastructure, but also

o telcos’ existing inrastructure, but also attract a large number o attract a large number o customerscustomers intereste

interested in d in maximizing IT investment by migrating to maximizing IT investment by migrating to the cloud. According tothe cloud. According to analysts, when compared to traditional hosting, cloud

analysts, when compared to traditional hosting, cloud hosting can help hosting can help enterprisesenterprises save 50% in costs with an

save 50% in costs with an associated ten-old increase in capacitassociated ten-old increase in capacityy2222_._.

SaaS Enablement SaaS Enablement

SaaS has the largest share o the cloud services market and

SaaS has the largest share o the cloud services market and its adoption withinits adoption within enterprises, especial

enterprises, especially SMEs, ly SMEs, is rising. is rising. TTelcos which have not elcos which have not yet ventured intoyet ventured into SaaS can quickly establish a rm ooting by partnering with a

SaaS can quickly establish a rm ooting by partnering with a wide range o ISVswide range o ISVs2323

and leveraging their existing inrastructure to deliver diverse

and leveraging their existing inrastructure to deliver diverse SaaS applications.SaaS applications. In addition to gaining a

In addition to gaining a substantial share o the large and increasing enterprisesubstantial share o the large and increasing enterprise spending on SaaS, these telcos can also improve customer loyalty by oering SaaS spending on SaaS, these telcos can also improve customer loyalty by oering SaaS as a value added service.

as a value added service.

22 nScaled,

22 nScaled,Slashing Costs and Driving Capacity for SaaS ProvidersSlashing Costs and Driving Capacity for SaaS Providers, February 2009., February 2009.

23

23 Independent Software VIndependent Software Vendors.endors.

24

24 Cloud Computing 201Cloud Computing 2010,0, An IDC Update An IDC Update, September 2009; Capgemini TME Strategy Lab Analysis., September 2009; Capgemini TME Strategy Lab Analysis.

25

25 Central Processing Central Processing Unit.Unit.

Service Attractiveness Service Attractiveness High High Low Low T T e e l l c c o o C C a a p p a a b b i i l l i i t t y y H Hiigghh LLooww SaaS Enablement SaaS Enablement Hosting on Hosting on Demand Demand Unified Unified Communication Communication Storage and Storage and Computing on Computing on Demand Demand Wholesale Wholesale Capacity Capacity

The Next Phase

Low Hanging Fruits Low Hanging Fruits

•

•Telcos can build on their first phaseTelcos can build on their first phase

services

services to expand their portfolito expand their portfolio of o of offerings

offerings

•

•Telcos can also leverage their global IPTelcos can also leverage their global IP

backbone to

backbone to offer capacity as a servioffer capacity as a servicece

•

•These services have a highThese services have a high

demand from enterprises demand from enterprises

•

•Telcos already possess significantTelcos already possess significant

expertise and assets required to expertise and assets required to deliver these services deliver these services

Broker Approach Broker Approach PaaS (Expose PaaS (Expose Network Network Functionality) Functionality) Cloud Billing Cloud Billing Future Future •

•These services require telcosThese services require telcos

to gain significant experience to gain significant experience in the cloud before launch in the cloud before launch

•

•They can help telcosThey can help telcos

differentiat differentiate their e their cloudcloud offering offering Cloud Security Cloud Security Services Services

Figure 8: Most Attractive Commercial Opportunities or Telcos in Cloud Computing

Hosting on-demand, SaaS

enablement, storage

and computing provide

an immediate attractive

opportunity or telcos

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Computing and Storage on Demand Computing and Storage on Demand

Computing, storage, and backup along with hosting constitute the bulk o US$5 Computing, storage, and backup along with hosting constitute the bulk o US$5 billion

billion2424 _{IaaS market.}_{IaaS market.}_T_T_{elcos already oering on-demand hosting can}_{elcos already oering on-demand hosting can cross-sell}_cross-sell

computing and storage through an integrated package. In addition to hosting, computing and storage through an integrated package. In addition to hosting, providing virtual CPU

providing virtual CPU2525_{instances (to meet the}_{instances (to meet the dierent computing needs o}_{dierent computing needs o}

customers) and on-demand storage and backup will

customers) and on-demand storage and backup will result in a result in a comprehensive IaaScomprehensive IaaS solution. In order to

solution. In order to deliver these additional services, existing data center resourcesdeliver these additional services, existing data center resources can be easily leveraged, thereby, minimizing incremental costs.

can be easily leveraged, thereby, minimizing incremental costs. Phase 2

Phase 2

This phase includes the next line o

This phase includes the next line o services, which telcos should oer in order toservices, which telcos should oer in order to expand their portolio o cloud services and establish a

expand their portolio o cloud services and establish a stronger ooting. Operatorsstronger ooting. Operators can sell these services on top

can sell these services on top o their existing cloud proposition. Cloud securityo their existing cloud proposition. Cloud security services, unied communication, and wholesale services all under this category. services, unied communication, and wholesale services all under this category. Cloud Security Services

Cloud Security Services

In terms o market share, telcos are one o

In terms o market share, telcos are one o the leading providers o managedthe leading providers o managed security services. They can quickly

security services. They can quickly leverage their existing expertise in network,leverage their existing expertise in network, application, and data security to deliver these services rom the cloud. Cloud application, and data security to deliver these services rom the cloud. Cloud security is an attractive market, which is set to rise

security is an attractive market, which is set to rise by 200%by 200%2626_{during the period}_{during the period}

rom 2008 to 2013. Telcos can capitalize on this opportunity by dierentiated rom 2008 to 2013. Telcos can capitalize on this opportunity by dierentiated oerings such as Distributed Denial

oerings such as Distributed Denial o Service (DDoS) o Service (DDoS) protection. Operatprotection. Operators haveors have an inherent advantage in this

an inherent advantage in this area because they can look area because they can look across their backbonesacross their backbones and prevent potential attacks earlier than most other

and prevent potential attacks earlier than most other service providers.service providers. Unified Communications (UC)

Unified Communications (UC) Enterprise customers are intere

Enterprise customers are interested more than ever in a sted more than ever in a common platorm or allcommon platorm or all their communications needs including IM

their communications needs including IM2727_{, presence, voice, conerencing, and}_{, presence, voice, conerencing, and}

email. The unied communications market is expected to rise at 55.6% CAGR email. The unied communications market is expected to rise at 55.6% CAGR to US$4.3 billion between 2008 and 2014

to US$4.3 billion between 2008 and 20142828_{, uelled by cloud computing. Telcos}_{, uelled by cloud computing. Telcos}

already deliver individual communication services like messaging, VoIP

already deliver individual communication services like messaging, VoIP2929_{, and PBX}_{, and PBX}

to enterprise customers. They can build on this experience to oer a

to enterprise customers. They can build on this experience to oer a unied userunied user interace and experience across multiple devices.

interace and experience across multiple devices. Wholesale Capacity

Wholesale Capacity

Reliable network connectivity, which includes ast and secure connections rom Reliable network connectivity, which includes ast and secure connections rom the cloud data center to the customer premise, is imperative or the success o the cloud data center to the customer premise, is imperative or the success o any cloud business. Telcos can oer capacity, over their global IP

any cloud business. Telcos can oer capacity, over their global IP3030_backbone_backbone

and private MPLS

and private MPLS3131_{networks, as a service to both}_{networks, as a service to both}_{cloud service vendors and}_{cloud service vendors and}

enterprises. In addition to capacity, large global operators can also white-label a enterprises. In addition to capacity, large global operators can also white-label a complete telco-ocused cloud inrastructure solution or

complete telco-ocused cloud inrastructure solution or regional operators.regional operators. The Future

The Future

Telcos should also think beyond traditional oerings and leverage the commercial Telcos should also think beyond traditional oerings and leverage the commercial opportunities present

opportunities presented by more novel services and ed by more novel services and delivery mechanisms such asdelivery mechanisms such as cloud billing, PaaS, and the broker approach.

cloud billing, PaaS, and the broker approach.

26 Gartner,

26 Gartner,Cloud-Based Computing Will Enable New Security Services and Endanger Old OnesCloud-Based Computing Will Enable New Security Services and Endanger Old Ones, June, June

2008.

27 Instant Messaging.

28 ABI Research,

28 ABI Research,Vertical Market Opportunities in Unified CommunicationsVertical Market Opportunities in Unified Communications, , Q4 Q4 2009.2009.

29

29 Voice over Voice over Internet Protocol.Internet Protocol.

30 Internet Protocol.

31

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32 Capital Expenditure. 32 Capital Expenditure. 33 Operating Expenditure. 33 Operating Expenditure. Cloud Billing Cloud Billing

Technical and cost challenges make it dicult or most cloud service providers to Technical and cost challenges make it dicult or most cloud service providers to run their billing inrastructure in-house. Unlike subscription based

run their billing inrastructure in-house. Unlike subscription based billing,billing, pay-per

pay-per-use billing is complex and ailing to -use billing is complex and ailing to get it right can result in get it right can result in revenuerevenue leakages. Telcos can leverage their experience in billing metered services to enter leakages. Telcos can leverage their experience in billing metered services to enter the cloud billing arena. Operators along

the cloud billing arena. Operators along with their billing partners can with their billing partners can provideprovide their expertise as a comprehensive cloud billing solution or vendors.

their expertise as a comprehensive cloud billing solution or vendors. PaaS

PaaS

As IaaS and

As IaaS and SaaS space becomes mature and increasingly competitive, operatorsSaaS space becomes mature and increasingly competitive, operators might shit their ocus towards PaaS in order to diversiy. PaaS is an attractive might shit their ocus towards PaaS in order to diversiy. PaaS is an attractive solution or ISVs and SMEs

solution or ISVs and SMEs to improve their productivity and reduce costs byto improve their productivity and reduce costs by using cloud-delivered toolkits or application development and deployment. using cloud-delivered toolkits or application development and deployment. Operators can build on

Operators can build on their existing experience with Service Delivery Platormstheir existing experience with Service Delivery Platorms (SDP) to oer PaaS. Telco assets such as voice, location, and presence can be (SDP) to oer PaaS. Telco assets such as voice, location, and presence can be oered to help application developers build applications that can

oered to help application developers build applications that can be monetized.be monetized. Telcos as Brokers

Telcos as Brokers There is a

There is a growing demand or “cloud growing demand or “cloud brokers” as intermediaries between endbrokers” as intermediaries between end users and cloud providers. From SLAs with multiple vendors to compliance and users and cloud providers. From SLAs with multiple vendors to compliance and security, the broker handles all cloud related issues or a customer. This approach security, the broker handles all cloud related issues or a customer. This approach also enables customers to switch cloud vendors without worrying about the also enables customers to switch cloud vendors without worrying about the operational details. T

operational details. Telco experience in delivering elco experience in delivering multiple services with multiple services with stringentstringent SLA requirement

SLA requirements, strong enterprise presence, and long s, strong enterprise presence, and long lasting relationship withlasting relationship with enterprise IT departments gives them an edge in the cloud

enterprise IT departments gives them an edge in the cloud broker space.broker space. Given the revenue potential and high demand o dierent cloud services, it Given the revenue potential and high demand o dierent cloud services, it is imperative that telcos do not delay their entry

is imperative that telcos do not delay their entry in this space. By diligentlyin this space. By diligently identiying and launching the right services at the right

identiying and launching the right services at the right time, operators cantime, operators can maximize their share o wallet while the end customers would reduce IT CAPEX maximize their share o wallet while the end customers would reduce IT CAPEX3232

and OPEX and OPEX3333_._.

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34 Service Delivery Platform.

6 Recommendations

As seen in previous sections, several telcos have entered into cloud computing and As seen in previous sections, several telcos have entered into cloud computing and are ocusing primarily on IaaS and SaaS. However, there is a signicant possibility are ocusing primarily on IaaS and SaaS. However, there is a signicant possibility o these services, especially IaaS being commoditized in the near uture. As the o these services, especially IaaS being commoditized in the near uture. As the intensity o competition increases and service

intensity o competition increases and service dierentdierentiation dilutes, margins williation dilutes, margins will all. Thereore, customization and dierentiation across their oerings, service all. Thereore, customization and dierentiation across their oerings, service delivery, and customer segment targeting, should be the hallmarks o a telco cloud delivery, and customer segment targeting, should be the hallmarks o a telco cloud strategy.

strategy.

In the subsequent subsections we will illustrate how telcos can carve their niche in In the subsequent subsections we will illustrate how telcos can carve their niche in these dierent areas.

these dierent areas. Service Offerings Service Offerings

In addition to providing traditional IaaS, operators should ocus on oering In addition to providing traditional IaaS, operators should ocus on oering localized and customized services which have a potential o commanding high localized and customized services which have a potential o commanding high margins. This will help them stay relevant in the ace o

margins. This will help them stay relevant in the ace o high competition romhigh competition rom established players such as Amazon

established players such as Amazon and Rackspace.and Rackspace. T

Telcos provide enterprise services across various geographies and elcos provide enterprise services across various geographies and have a goodhave a good understanding o local market demand or these services including cloud. They understanding o local market demand or these services including cloud. They are, thereore, best equipped to address the

are, thereore, best equipped to address the regional cloud services market needs.regional cloud services market needs. For example, in certain geographies cloud

For example, in certain geographies cloud -based Virtual Desktop Inrastructure-based Virtual Desktop Inrastructure may have high

may have high demand, whereas other enterprises might be more interested indemand, whereas other enterprises might be more interested in disaster recovery

disaster recovery. . By quickly By quickly identiyiidentiying and ng and addressing such opportunities,addressing such opportunities, operators can gain an edge over

operators can gain an edge over the competition.the competition. Oering customize

Oering customized cloud solutions can help d cloud solutions can help telcos price their services at atelcos price their services at a premium. For instance, replicating the exact sotware testing environment on the premium. For instance, replicating the exact sotware testing environment on the cloud is a challenge or

cloud is a challenge or enterprises because many provideenterprises because many providers do not rs do not oer customoer custom OS images and limit the type o

OS images and limit the type o congurations. By providing a customized virtualcongurations. By providing a customized virtual environment or companies to replicate their exact test conditions, operators can environment or companies to replicate their exact test conditions, operators can not only dierentiate their oerings but also

not only dierentiate their oerings but also charge higher margins.charge higher margins.

Source: Capgemini TME Strategy Lab Analysis;

Source: Capgemini TME Strategy Lab Analysis; VON,VON,Telco Strategies to Win a Share in the SaaS PieTelco Strategies to Win a Share in the SaaS Pie, June 2007;, June 2007; Company Websites Company Websites Telcos as Telcos as hosting hosting service service providers for providers for SaaS SaaS Telcos as Telcos as SaaS SaaS enablers enablers 

Expanding basic hosting capabilities toExpanding basic hosting capabilities to

support SaaS delivery support SaaS delivery



Telcos with limited interest in developing aTelcos with limited interest in developing a

robust SaaS roadmap should adopt this robust SaaS roadmap should adopt this strategy

strategy



In addition to offering hosting services, aIn addition to offering hosting services, a

telco acts as an aggregator of SaaS telco acts as an aggregator of SaaS



Telcos with a high interest in SaaS andTelcos with a high interest in SaaS and

keen on positioning themselves as a keen on positioning themselves as a one-stop-shop for enterprise software should stop-shop for enterprise software should adopt this strategy

adopt this strategy

Telcos as Telcos as SaaS SaaS eco-system system providers providers 

Along with hosting, a telco can provideAlong with hosting, a telco can provide

carrier-class data infrastructure, network carrier-class data infrastructure, network connectivity

connectivity, and , and 24x7 monitoring24x7 monitoring



TelcoTelcos keen s keen on differentiating their SaaSon differentiating their SaaS

proposition and providing value added proposition and providing value added services should go for this strategy services should go for this strategy

I I n n c c r r e e a a s s i i n n g g T T l e e l c c o o I I n n v v o o l l v v e e m m e e n n t t

Figure 9: Telco Strategies in the SaaS Space

Oering customized cloud

solutions can help telcos

price their services at a

premium

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35

35 Information and Computing TInformation and Computing Technology.echnology.

In the SaaS

In the SaaS space, there are three dierent strategies which telcos can adopt space, there are three dierent strategies which telcos can adopt (see(see Figure 9) with the level o involvement by operators varying signicantly. Telcos Figure 9) with the level o involvement by operators varying signicantly. Telcos should evaluate the level up to which they

should evaluate the level up to which they want to have a want to have a SaaS presence andSaaS presence and accordingly adopt the right strategy.

accordingly adopt the right strategy.

PaaS is an area which will see limited action rom telcos in

PaaS is an area which will see limited action rom telcos in the near uture.the near uture. Beore establishing a PaaS presence, telcos would need

Beore establishing a PaaS presence, telcos would need to careully evaluate theirto careully evaluate their technology readiness and experience with platorms such as

technology readiness and experience with platorms such as SDPSDP3434_._.

Service Delivery Service Delivery T

Telcos should endeavor to deliver services in a elcos should endeavor to deliver services in a way that customers can enjoy theway that customers can enjoy the cost benets o public cloud and the

cost benets o public cloud and the security and reliability oeresecurity and reliability oered by privated by private clouds. This can

clouds. This can be achieved through Virtual Private Cloud (VPC) deployments.be achieved through Virtual Private Cloud (VPC) deployments. This model delivers services rom a public cloud over

This model delivers services rom a public cloud over MPLS-based VirtuaMPLS-based Virtual Privatel Private Networks. VPC, thereor

Networks. VPC, thereore, oers the ull security and privacy e, oers the ull security and privacy o a private cloud,o a private cloud, but pushes hardware ownership to the service provider. Telcos can leverage their but pushes hardware ownership to the service provider. Telcos can leverage their distinct strength in providing reliable private IP s

distinct strength in providing reliable private IP service to enable a ervice to enable a cost eectivecost eective and secure VPC solution.

and secure VPC solution.

In order to address customer concerns such as security, costs, and vendor In order to address customer concerns such as security, costs, and vendor lock-in, telcos can take up the role o

in, telcos can take up the role o a cloud broker (see Figure 10). This is a cloud broker (see Figure 10). This is anotheranother innovative approach to service delivery where telcos

innovative approach to service delivery where telcos are well positioned comparedare well positioned compared to their competitors because o

to their competitors because o strong enterprise relationshipstrong enterprise relationships and s and experience o experience o delivering multiple services involving stringent SLAs. However, operators should delivering multiple services involving stringent SLAs. However, operators should build signicant experience in cloud computing beore adopting

build signicant experience in cloud computing beore adopting this approach,this approach, so that they

so that they can successully tackle the complexities associated with end-to-endcan successully tackle the complexities associated with end-to-end solution delivery.

solution delivery. Customer Segment Customer Segment

Large enterprise customers have multi-country operations and serious concerns Large enterprise customers have multi-country operations and serious concerns about the security o their applications and data. Also, due to

about the security o their applications and data. Also, due to the sheer size andthe sheer size and complexity o their operations, deploying cloud

complexity o their operations, deploying cloud services, integrating them withservices, integrating them with on-premise systems, and continuous maintenance and support becomes a on-premise systems, and continuous maintenance and support becomes a highlyhighly complex process. In order to

complex process. In order to target large enterprises, telcos should try and target large enterprises, telcos should try and oeroer enhanced security and end-to-end cloud solutions

enhanced security and end-to-end cloud solutions across multiple countries.across multiple countries.

Source: Capgemini TME Strategy Lab A

Source: Capgemini TME Strategy Lab Analysis; Forresternalysis; Forrester, February , February 20092009

Telcos can mitigate most customer concerns related to cloud, by taking the role

Telcos can mitigate most customer concerns related to cloud, by taking the role of a broker of a broker

37% 37% 30% 30% 25% 25% 20% 20% 14% 14% Cost Control Cost Control Security Security Compliance Compliance Performance Performance Vendor Lock-in Vendor Lock-in

Enterprise Cloud Customer Concerns, %, 2009 Enterprise Cloud Customer Concerns, %, 2009

Creating a level of abstraction between the customer and Creating a level of abstraction between the customer and multiple CSVs

multiple CSVs ensures seamless switching of vendorensures seamless switching of vendorss

End to end

End to end SLA management, by controlling the entireSLA management, by controlling the entire delivery chain of services, will ensure high

delivery chain of services, will ensure high performanceperformance

Delivering services through vendors which fulfill all Delivering services through vendors which fulfill all compliance and regulatory criteria will allay this concern compliance and regulatory criteria will allay this concern

By monitoring security of multiple CSVs and

By monitoring security of multiple CSVs and providing anproviding an additional security layer, security concerns can be reduced additional security layer, security concerns can be reduced

Effective allocation and optimum utilization of internal and Effective allocation and optimum utilization of internal and external resources will ensure effective cost control external resources will ensure effective cost control

Major

Major Customer Customer Concerns Concerns How How Can Can Telcos Telcos Address Address These These As As Brokers?Brokers?

Cloud Computing: The Telco Opportunity

Clou

Clou

d

d

Compu

Compu

ti

ti

ng

ng

The Telco Opportunity

The Telco Opportunity

Telecom & Media Insights

Telecom & Media Insights

Issue 57

Contents

Contents

1 Abstract

1 Abstract

2 Introduction

2 Introduction

Given the revenue

Given the revenue

potential, telcos should not

potential, telcos should not

not delay their entry in the

not delay their entry in the

cloud computing space

3

3

Marke

Marke

t

t

Dy

Dy

nam

nam

ics

ics

4

4

T

T

elco

elco

Activ

Activ

ity

ity

in

in

Cloud

Cloud

Computing

Computing

Several telcos have

Several telcos have

entered the cloud

entered the cloud

computing market with

computing market with

IaaS as their agship

IaaS as their agship

oering and a strong ocus

oering and a strong ocus

on the enterprise segment

5

5

Attract

Attract

ive

ive

Opportu

Opportu

nities

nities

fo

fo