Informa: Cloud Services a Great Carrier Ethernet Opportunity

CEN Feature (Sep 13 2011)

1. 

   Telecom carriers worldwide have already invested $8 billion in 2011 pursuing the hot cloud services market, according to the research firm Informa. And carrier Ethernet is likely to play an increasingly important role in supporting carrier cloud offerings, predicts Informa analyst Camille Mendler, who has been keeping close tabs on what 100 or so service providers worldwide are doing in the cloud market. 

   We’re looking at what telcos are doing in the cloud space and seeing services that implicitly and explicitly link Ethernet with the cloud,” she said.

   As communications service providers seek a differentiation point in the cloud services market, the communications link is a natural place to look. Mendler points to European carrier Completel as one example of a carrier that has effectively used this strategy, offering Carrier Ethernet as the communications link to its own cloud services.

   Mendler notes that a large portion of service providers’ investment in cloud offerings will involve the data centers from which the service providers will deliver their own cloud services. Even so, there are also cloud service opportunities for service providers that opt not to make a heavy data center investment.

   Mendler cites the example of Level 3 Communications, which recently inked a deal to provide connectivity to Amazon Web services. Through that deal, Level 3 gives Amazon the ability to offer enterprise users a single source for end-to-end connectivity to cloud services delivered from Amazon data centers — and Level 3 executives have stated that they expect Ethernet to be one of the most popular connection options.

   Comcast also has been able to minimize its investment in data centers by partnering with cloud service provider Ascent Data, Mendler says. One of Comcast’s roles is to provide secure connectivity via Ethernet to Ascent’s data center, and the companies jointly market co-location, hosting and cloud services.

   Orange Business Services is in the cloud service market itself. But as Mendler notes, that hasn’t prevented the company from also offering secure connectivity to various cloud providers that also may be competitors.  Through its VPN Galerie offering, Orange certifies that a communications link can support a secure connection, Mendler explains — and those connections, too, are often based on Carrier Ethernet.

   In the future, Mendler sees another opportunity for communications service providers wanting to minimize the investment required to deliver cloud services. As part of the long-term evolution of Ethernet exchanges, she said, “I see there will be additional functionality for the Ethernet exchanges to become hubs for cloud services.” She envisions communications service providers with connectivity to those exchanges offering white-labeled cloud services to their customers.

   As in a previous article on CEN, Mendler has noted that Ethernet exchange operator Equinix has begun to “play very cleverly in this space.”

   Mendler also had some interesting things to say about how Ethernet services need to evolve to meet cloud service requirements, which CEN will cover in follow-up article coming soon.

   Bookmark or Share this article

Login to comment