Cloud has silver lining for telcos

Recent forays into cloud computing by Australia's big telcos seem to be paying off, despite the arrival of US cloud providers on our shores.

Recent forays into cloud computing by Australia's big telcos seem to be paying off, despite the arrival of US cloud providers on our shores.

Uptake of cloud services by Telstra's customers is accelerating, iiNet is about to add additional cloud capacity and Optus is gearing up for increased demand.

Telstra now has 20,000 cloud customers, up from 16,000 in February. When announcing the company's half-year results in February, CEO David Thodey said of the 16,000, 3000 had been added in the previous six months. "Cloud computing is no longer a gleam in our eye, it is actually a very critical part of our business," he said.

Telstra is two years into a five-year, $800 million cloud investment that includes services for large enterprises, in addition to small business bundling of cloud apps through T-Suite. It reported a 25 per cent increase in cloud services revenues in the half-year from the corresponding period in 2011.

Telstra's director of cloud services, David Riad, would not comment on current growth rates, but the 4000 customers added in the three months since suggest growth is accelerating.

Smaller ISP iiNet announced its Business Cloud offering in November 2011 aimed at small businesses and offering cloud computing from infrastructure-as-a-service to application hosting.

Kevin Clark, iiNet's hosting manager, said the original facility in its Perth data centre was now almost full. "I am weeks away from announcing the completion of the expansion in Perth and availability in our Canberra data centre," he said.

Mr Clark said the Canberra site, built by TransAct, an iiNet subsidiary, was "a tier-four ASIO-certified data centre. It is one of the best that we could put our cloud facility in."

Telstra and iiNet are both planning to expand their software-as-a-service offerings. In April, iiNet announced a hosted Microsoft Exchange product and is expected to follow with Microsoft Lync soon.

Telstra is moving to exploit synergies between cloud-based applications and the network over which they are delivered. Mr Riad said it was working towards application-aware networking where the performance of the network is adjusted according to the application. For example, a high-definition video conference could be allocated greater bandwidth and a low latency route.

"You will see some announcements over the next couple of months on this. We are looking to continually roll out further intelligence into our networks because they give us a definite advantage."

AAPT, too, promotes its network as a key feature of its cloud offering. But unlike Telstra, CEO David Yuile said he did not believe AAPT should be in the software business. "Our role is having a super high-speed network that seamlessly connects together all the data centres and all the enterprises so they can access the right apps from the right people," Mr Yuile said.

Optus made its debut in cloud through its IT services subsidiary Alphawest in September 2010 with Optus Elevate, an infrastructure-as-a-service offering. This month, the company announced a major restructuring that will see Alphawest and the Australian arm of NCS combined with Optus Business, and a cloud computing and data centre "centre of excellence" created.

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