Verizon’s CloudSwitch Acquisition Added Value to its Cloud Enterprise

Verizon again made a milestone when it acquired CloudSwitch last month; this was following its earlier purchase in January of Terremark, a premier cloud storage provider. The latest acquisition of CloudSwitch is expected to boost the cloud enterprise value of Verizon. This is following the global trend from big mobile and smartphone providers like AT&T, Telstra, BT and Verizon in the battle for cloud control. The move is to seek new avenues where they can offer better and diversified services to customers. This is as the telecommunications business from both local and international traffic calls further decline. Although data hosting and networking seems to be the new venture, the partnership of Terremark and CloudSwitch will definitely make a roaring statement as it endeavors into the cloud.

The world’s telephone giant companies are now ready and established to do hosting and co-location services, hosting large corporations that have deep pockets to support their cloud venture. One issue, however, that small-scale telcos must deal with is the fact that their traditional systems cannot easily handle the transition to the cloud.

David Linthicum of Infoworld commented of Verizon’s acquisition of Terremark and said  “Verizon has the same problem as many other telecommunications giants: It has fat pipes and knows how to move data, but it doesn’t know how to turn its big honking networks into big honking cloud computing offerings.” This move from Verizon is not unique to them, Orange is another cloud player that is selling GoGrid, which is manufactured and developed by another cloud solutions provider.

Ed Gubbins, NPRG’s Senior Analyst said “Locating and building data centers, outfitting them with the necessary equipment, efficient energy supplies and software and building a capable staff is no small task for a company like Verizon with lots of other business segments it must attend to. “It takes time,”‘ Verizon’s COO, Lowell McAdam said . . . “That’s not our core competency.”

Terremark and the rest of their competitors are making their statement very clear; that they can and are able to provide more agile data centers. This is just one way for Terremark to gain control over Verizon’s data storage center to improve its speed to make it more robust for the cloud environment.

Bloomberg BusinessWeek caught interest of Verizon’s business move to acquire Terrizon and said the $1.4 billion investment placed the company in a strategic cloud position. Another investment that may attest more significant for Verizon is the purchase of CloudSwitch, the brains behind LaunchPad that was commenced at GigaOM’s 2010 Structure conference.

Verizon’s business strategies become more appealing to customers because they now prefer to buy products and applications in packages instead of just mere data center access. They find more appeal in products that can provide scalable and secure networking plus hosting facilities that can easily fit into their existing servers.

Other vendors may be able to offer products at a much cheaper price and in separate applications, but Verizon’s packaging will be very hard to resist for customers as it proves to provide more peace of mind for any computer or business cloud solutions.


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