Last week IBM announced their intent to spend another $1.2B on expanding their SoftLayer-based cloud data centers to 15 new data centers around the world in 2014. This brings the total data center count to 40 data centers globally in 13 countries. SoftLayer has over 22,00 customers and was acquired by IBM in 2013 for a reported $2B. Why does this matter? There are few reasons why this matters for IBM and for their customers:
· CIOs and the lines of business are spending IT dollars on cloud and IBM has to have a way of capturing some of that opportunity.
· IBM Global Services (IGS) has been an IBM mainstay for many years and extending the managed services business with cloud (multi and single tenant) services just seems like a good adjacent business to be in. This allows IBM to provide different economic models to the customer with varying degrees of control over cost, management, and provisioning for the customer.
· By having multiple data centers in multiple countries, IBM allows customers to keep data within country boarders as needed. If a company wants to operate in several countries, it absolutely can with redundancy within the country or at least within larger economic and political boundaries such as the EU.
· IBM has always delivered products to the enterprise that are robust and provide important business functionality. As service offerings mature, SoftLayer customers will have an rich portfolio of IBM service offerings that were once only available via perpetual license. SoftLayer’s service catalog will give the customer more economic and usage model choices over time.
For IBM, this is an important investment that shows their continued commitment to cloud computing as well as to their customers who we continue to see making a more significant transition to cloud services each year (our 2014 cloud spending report will be out this quarter – with some really eye-opening data!). For customers, this gives them a choice from an important technology partner. The cost of learning how to use and manage all new business software can be mitigated as IBM brings the rich portfolio it has to the cloud as well as by delivering new services that support the needs of business.
Is this an Amazon killer? Nope, not in my book. Amazon is an important cloud ecosystem in its own right with the ability to meet some of the same requirements that IBM is trying to address for the enterprise, but AWS also supports many new services needs that web scale applications. I think they are both important and hopefully, over time, we’ll see some interesting integration capabilities that allow the two to do what they do best while giving the enterprise the ability to focus on how to grow their business and worry less about IT infrastructure.