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Public and Private Clouds for the Enterprise

Telecommunication service providers will likely consume their own cloud services. After all, every organization can gain something from the proven benefits of infrastructure and application out-tasking. However, their primary role will be to implement and deliver the services that their end-customers will seek from public, virtual private, and hybrid clouds.

Service providers have the opportunity to extend their current offerings, which may already include hosting, communications, media, and software application services. Moreover, cloud offerings enable service providers to extend their reach beyond their traditional areas of operation.

That said, service providers must be prepared to address customer concerns ranging from policy compliance, to end-to-end security, to quality of service management, and to technical customization. They must be able to deliver a flexible range of functionality, service levels, and payment models.

Enterprise Cloud Use-Case Scenario
  • Many enterprise-focused service providers (SPs) have an opportunity to create higher-value, differentiated service offerings. They have unique capabilities they can leverage, including customer relationships, physical assets, and extensive operations experience.
  • At the same time, over-the-top services (such as Skype VoIP) threaten traditional SP revenue streams (e.g., wireline and mobile voice services). So, SPs have an incentive to evolve their value-add capabilities.

Role for Cloud Technologies
  • Cloud is unlocking huge growth potential through new service offerings (e.g., infrastructure as a service, collaboration as a service).
  • SPs offering cloud services have several avenues of differentiation in terms of deployment models (e.g., public cloud, virtual private cloud, hybrid cloud) and service types (e.g., infrastructure, collaboration).
  • A cloud-ready architecture can also reduce an SP’s overall cost of delivery through more efficient and sustainable infrastructure platforms.

Application Considerations
  • As table-stakes, SPs offering cloud services must ensure security and isolation of customer data in a multi-tenant environment. They must also offer a comprehensive suite of basic services (e.g., voice, collaboration).
  • Initial customer acquisition will be driven by distinctive solutions with differentiated services and end-to-end service level agreements (SLAs).
  • Over the long term, SPs must be able to deliver cost-effective services with viable margins.

While large enterprises also see tangible benefits in using public clouds, we expect private and hybrid cloud models to be very common. Large enterprises may use public clouds for burst or peak capacity and for select services that are difficult to scale themselves.

However, these organizations often require a higher degree of control over their data, applications, and systems than current public clouds allow. At scale, a private cloud offers the efficiency and agility of a public cloud -- without the loss of control.

Still, the IT services that a pure private cloud can offer are often limited to what internal IT can develop or deploy. This is where managed cloud service providers can add value.