Connecting clouds; building Ecosystems - Telco journey to the Cloud

In the journey towards the cloud, long term, enterprises are more likely to buy all services from a single provider integrating the different cloud and connectivity needs. Therefore we’ll see a number of ecosystems emerging that bring in all the important things needed. Are telecom operators ready for it?

Service providers anchored in the old world of VPN connectivity won’t certainly be well positioned… while those that created a more dynamic infrastructure will (see Telco journey to Cloud part 1).

Who’s going to keep the relationship with the customer?

Let’s look at a couple of examples.

1.       OTT cloud services owning the relationship with customers

 IBM cloud services, can offer today their services directly to the enterprises, and it includes both the cloud and connectivity services, provided by different local providers. But, will IBM be able to include in their ecosystem enough services to satisfy the customer needs? However, it’s unlikely that IBM could resell Oracle’s or SalesForce.com services. OTT cloud services (like IBM) can provide access to its cloud using a variety of telecom operators, offering flexibility in the connectivity but the number of services might be limited. Oracle and SalesForce.com have recently announced an agreement to merge their two cloud offerings (see Oracle joins rivals to advance cloud computing).

2.       Telecom operator owning the relationship with customers

Orange Business VPN Gallery is a Telco cloud offering that integrates connectivity services (i.e. VPNs) with its own cloud services a third party services through a partnership ecosystem model.

See video: 

                          
Orange Business Services_Business VPN Gallery by UNITEAM_Paris

As we can see in that model, the end customer gets all cloud services directly into their VPN with security and reliability. This model looks great from the telecom operator side as it maintains the relationship with its customers, but also has the opportunity to show its value. It’s also good for the third party cloud providers, as they can benefit of the proximity of the telecom operator to sell its service. In this model, customer expectations would be high; they would expect a fully integrated model between the cloud service and the connectivity piece.

This second model is not going to be easy for service providers as it requires to establish its ecosystem and include the big names on it.

So, I guess the two models will coexist. Enterprises with large IT departments will be able to deal simultaneously with multiple connectivity providers and cloud providers to get best of bread. Enterprises with modest IT departments will rely either with the telecom operator or the OTT cloud provider for all their services.