“Cloud computing” is one of those “hyped” concepts the telecom industry runs into from time to time that can be confusing both for customers and channel partners alike. To make matters worse, suppliers often try to repackage existing services by calling them cloud services, when, strictly speaking, those services are not “cloud computing” applications or services.

Many of the components of a “cloud service” resemble older products and apps.
For example, datacenter products are sometimes labeled as cloud services. Datacenter solutions can involve service level agreements, redundancy, load balancing or guaranteed bandwidth services, but none of those are cloud computing. Selling datacenter rack space, power and cooling are growing businesses for some telecom companies, but are not “cloud services.”

Neither is “remote access” to servers; computing as a service; or managed services. They are building blocks for cloud computing, but not “cloud computing.” Likewise, remote backup and virtual private networks are older concepts that resemble, but are not, “cloud computing.”

Cloud computing is a marketing term; a delivery model for information technology; a computing architecture; a business model and also the framework for many different types of services. Put simply, cloud computing is about “renting” rather than “owning.” Think of the difference between buying a movie and renting a DVD. Buying a DVD is like traditional enterprise computing. “Renting a movie” is like cloud computing.

There are a few “flavors” of cloud computing, usually software, platform, and infrastructure sold “as a service.”

- “Software as a service” is the most prevalent form of cloud computing, by volume of users. SaaS includes any retail apps directly used by people, either in their roles as business or consumers.

-  “Platform as a service” generally is useful to application developers rather than retail end users, as it includes rental of computing resources to create, test, and manage an application. Basically, it is sold to software developers.

- “Infrastructure as a service” means renting computing power and storage, not “rack space.” IaaS is sold to enterprises and app providers.

- IaaS services generally fall into several buckets: “public cloud,” “managed public cloud,”virtual private cloud,” and “private cloud.”

The first two concepts involve end user access to cloud apps on either an “un-managed” basis (typically retail consumer apps such as Google search) or “managed” basis with service level agreements, and as their public moniker implies, generally are retail and consumer apps designed for use by the public.

The last two concepts involve something more like traditional enterprise computing. A virtual private cloud simply designates resources to a single customer. It typically is used by an enterprise for “private” network apps internal to the organization.

A “private cloud” means an enterprise owns its own servers and uses them to deliver internal data and apps to enterprise employees and partners, not the general public. In some cases, enterprises that own their servers use a remote datacenter to operate them. Private cloud is one of the concepts that accounts for confusion. Strictly speaking, it is not cloud computing, since the servers are not rented, but owned.

It can be very hard to explain precisely what a particular “cloud service” is, or why it is better than conventional “shrink wrapped” software purchases. The analogy many will be familiar with is “hosted PBX” services as an alternative to buying a business phone system.

But selling simple “rack space” is not cloud computing software, platform, or infrastructure. Think of rack space and datacenter hosting as a layer one enabler of cloud computing. It is the finger pointing at the moon, not the moon.

1. Capital spending on server hardware and virtualization software will slow as spending on cloud computing rises, according to recent research published by CIO magazine. The study also suggests that a significant chunk of enterprise spending will shift to mobile devices, applications and development tools.

2. Tablets will become real business tools. Some tell-tale signs: Forrester Research predicts more than 77 percent of organizations will support Google Android and iOS devices next year. Also, a recent survey by the NPD Group reveals that 73 percent of small to medium-sized businesses will buy tablets such as Apple’s iPad.  

3. With “IT consumerization,” (employees increasingly bringing tablets, smartphones and other devices to work), investments in IT security will surge – so much so that Canalys expects the enterprise security market to grow about 9 percent in 2012.

4. Current Analysis reports that enterprise applications and storage were the most used cloud services among businesses in 2011, and predicts the trend will continue this year. Approximately 50 percent of IT decision makers surveyed by the firm either utilize or plan on utilizing online storage and backup.

5. Maravedis predicts that telecom network operators will emerge as leaders in providing secure and guaranteed business cloud services, and also expects that carrier-class cloud architectures and platforms will emerge and disrupt the cloud services value chain as the cloud market moves from the early adopter phase to mainstream adoption.

6. Managed services growth among businesses should increase considerably, according to a recent survey by CompTIA. Among current users of managed services, 46 percent have trimmed their annual IT expenditures by 25 percent or more as a result of shifting to managed services, and 13 percent have slashed annual IT expenditures by 50 percent on the functions they are outsourcing.

7. TeleGeography reports that demand for retail colocation space is growing relentlessly and that operators are scrambling to expand current sites and build new ones to keep up with a projected compound annual growth rate (CAGR) of 12 to 14 percent.

As technologies, services, applications and business practices evolve, we will continue to develop creative and cost-effective solutions that deliver real value to our customers. Our colocation products, OneSecure managed security offerings, RemoteStor data recovery services and wireless broadband solutions, for example, are quite literally related to the trends above.

In the coming months and years, a variety of enterprise and small-business software products, not to mention new mobile services of many types, will be coming to market. Know that we’re preparing for them and that our products and resources will be in lock-step with market developments impacting our customers.

In fact, managed services growth among businesses is expected to increase considerably over the next two years, according to a recent study by CompTIA, an IT industry association. Among current users of managed services, CompTIA reports, 46 percent have trimmed their annual IT expenditures by 25 percent or more as a result of shifting to managed services, and 13 percent have slashed annual IT expenditures by 50 percent on the functions they are outsourcing.

With those kinds of savings, it’s no wonder that Insight Research predicts the market for managed services to double from $140 billion to $266 billion by 2016. TelePacific recognized this trajectory several years ago and planned accordingly, making significant investments in our datacenter, managed security and data recovery solutions.

We have colocation facilities in San Jose, Sacramento, Santa Ana, San Diego and Las Vegas. We also operate two SAS 70 (transitioning to SSAE 16) Type 2 certified datacenters in both Sacramento and Santa Ana. Our two datacenters, one in Northern and one in Southern California, provide excellent geographic diversity and offer customers full and partial cabinets; complete ping, power and space including UPS; N+1 power and cooling; high-security infrastructure and procedures; customer amenities; “remote hands” services; and 24×7x365 support and access.  

In addition, our OneSecure managed security services offer Internet security on demand to protect customers from online dangers. OneSecure provides six layers of network security:

• Firewall to lock or unlock ports to allow or prevent traffic into a customer’s network;
• IPS, which uses deep packet inspection to analyze network traffic and block packets known to match thousands of malicious code signatures;  
• Gateway Antivirus to thwart attacks by checking all HTTP, HTTPs, SMTP and FTP traffic for malicious code embedded within the traffic and block access to infected sites;
• Web Content Filtering to help companies prevent unauthorized web browsing;
• SPAM Filtering, which passes all incoming email through a multi-layered SPAM filtering system that blocks or identifies/categorizes inbound SPAM; and
• Virtual Private Network, allowing individual employees, remote office location and/or suppliers to securely connect to the LAN.

We also offer RemoteStor data recovery services to protect customers from unexpected events such as disk crashes, server corruption, viruses and national and human disasters. Every night, RemoteStor automatically and securely backs up critical information over a customer’s existing Internet connection to our advanced storage infrastructure located in our datacenter facilities.

For more information about our datacenter, managed security and data recovery services, please contact your TelePacific representative.

VAR effectiveness as a channel for selling managed services likely will vary widely. For example, managed services, such as hosted email, backup and disaster recovery, security, and customer relationship management, might be a reasonable fit for a VAR already selling servers, routers, and other IT infrastructure.

But sales of cloud-based inventory, transaction processing, accounting or personnel applications delivered as managed services will make more sense for software VARs with the product knowledge to sell cloud-based business applications.

Some telecom channel partners, on the other hand, are already moving outside their traditional product lines, selling managed services that historically have been IT or Internet service provider products.

So what makes more sense: buying IT-oriented products and apps from a “telecom agent” or buying access, transport, and voice solutions from an IT specialist?

Both options. TelePacific increasingly supports VARs that are selling data connections, colocation, MPLS, and mobile broadband backup. We’re also helping telecom agents sell hosting, intrusion detection system/intrusion prevention system (IDS/IPS), firewall, filtering, and other managed security products.

In the coming months and years, a variety of enterprise and small-business software products, not to mention new mobile services of many types, will be coming to market. We cannot know for certain how channel partners’ knowledge, skills, and business practices will evolve as more of the strategic value from IT and communications is provided by “software” elements of services.

However, there is little doubt both telecom agents and VARs will continue to find fresh and creative ways to deliver value to businesses as new services and applications emerge. 

Happy holidays.

Data breaches and loss due to fire, flood, lack of proper climate controls, negligence, and theft can cost a fortune to litigate, leave a legacy of bad PR and recurring headaches, and often force a business to close. Hence, the value of protecting mission-critical applications and data afforded by off-site collocation facilities dramatically increases, especially for organizations operating in medical, healthcare, financial, and government verticals with strict privacy and compliance standards.

Professionally run off-site datacenters possess the power, cooling, monitoring, security, and equipment redundancies necessary to protect IT systems and business-critical applications.

Channel partners win several ways by selling datacenter solutions. Solving more of an organization’s problems is one advantage; providing security and peace of mind another. However, datacenter services also create demand for high-quality bandwidth products.

Servers require network connections and secure services require redundant, spatially-diverse data connections for the server and management locations. Beyond that, the increasing demand for mobile and remote end user connections means broadband networking requirements both at remote sites and on a mobile basis. Bringing datacenter offerings into the equation allows channel partners to “pull through” additional bandwidth services that make for lucrative and sticky accounts.

Moreover, once customers install equipment in a datacenter, they often upgrade the bandwidth before their term is completed. Also, as organizations increasingly put all traffic and applications on a single IP network, the increased demand for QoS-capable protocols, such as MPLS, provides yet another revenue opportunity.

We’ve made significant investments to upgrade and expand our datacenter offerings. There is a tremendous advantage in terms of capabilities, cost, service, and overall value to your customers by having all of these needs met by one combined datacenter and services solution provider.

Market demand is increasing and there has never been a better time to sell our datacenter solutions. Our “show and sell” value pricing promotion offers uniform and discounted rack space, power, and network bandwidth for all our datacenter and colocation facilities, as well as discounts up to 30 percent off previous bandwidth pricing. Contact your channel manager for further details.

Industry analysts assert that employers are increasingly acquiring mobile devices for employees because it allows them to integrate said devices and related applications into their corporate strategy, communications network and services. In fact, the ability to better control and manage mobile devices will become more imperative as businesses continue to shift applications to the cloud and as more of their employees access these applications using mobile devices.

For example, IT respondents in the Cohen study intend to support video conferencing (46%), instant messaging (44%), single voicemail (41%), video calling (40%), web/group collaboration (35%), extension dialing (31%), corporate directory (27%) and presence management (24%) on mobile devices within the next three years.

Interestingly, despite the introduction of numerous smart phones over the past few years and their growing appeal, BlackBerry is still widely supported among IT business leaders, especially larger enterprises (67%), according to the Cohen study, which shows the following support for mobile devices among small, medium and large businesses:

• BlackBerry (51%)
• iPhone (40%)
• Android (31%)
• Basic mobile phones (30%)
• Tablets (30%)
• Other smartphones (21%)

The Cohen study and other recent surveys illustrate how mobility and cloud trends are changing the buying habits of businesses. We’re witnessing it first hand with strong customer interest in wireless laptop connectivity and Wifi hotspot devices, as well as group purchases of wireless bundles that make it easy to quickly equip organizations with mobile workforces.

If you would like to learn more about our mobile solutions and bundles, please reach out to your TelePacific representative or contact us.

Years ago, TelePacific created a team of solutions architects to address this growing need and more recently have fortified the group with additional solutions architects and other resources to make sure our partners have the assets they need to sell our expanding product portfolio. These solutions architects provide:

* Technical expertise to assess customer needs and assist with RFPs

* Designs for custom solutions that meet customer requirements and goals

* Network diagrams and supporting documentation

* Resolutions for technical issues identified in the pre-sales process

* Responses to partner and their customer inquiries

* Any other assistance throughout the pre-sales and sales process, including on-site visits, to position products appropriately and drive sales to completion

Our solutions architects frequently support agents with all manner of multi-location solutions as well as colocation, managed data protection services, and OneSecure network security products. However, since signing a definitive agreement to acquire Telekenex, a business-grade IP services provider with a nationwide PCI compliant MPLS backbone, they increasingly have been assisting agent partners with large MPLS and MPLS + SIP Trunking opportunities.

Recently, our architects collaborated with a channel partner to design and close a 70-location nationwide MPLS deployment for a large equipment rental company. Also, they recently collaborated with another channel partner, two channel managers, and additional personnel from Telekenex to close a 40-location MPLS deal that we installed in just 30 days. It was a great team effort that exemplifies what we at TelePacific are capable of doing to help channel partners win-over prospective customers.

At present we have 16 solution architects with extensive sales engineering experience and we’re in the process of hiring more. Every architect is educated on new technologies, industry standards, and TelePacific products. They’re also highly qualified to assess the business needs of our channel partners’ clients, design winning solutions, and provide support through the entire sales process.

If you’re not already taking advantage of this tremendous resource, please reach out to your channel manager for more details.

The authors are convinced that we are not in a “Great Recession, or a Great Stagnation, rather that we are in the early throes of a Great Restructuring,” and they make a convincing case by showing how computer and information technologies have accelerated productivity gains at such a rate that the economy cannot absorb the excess labor. In other words, technology has raced past human capacity to keep up. It’s made our businesses so innovative and productive that persistent unemployment at levels we’re not used to will continue until we can adapt and catch up to the Great Restructuring, which could be awhile. 

If high unemployment in the U.S. persists – and most economists predict it will – chances are good that customers in many business verticals will consume less in 2012, putting more revenue pressure on companies and forcing them to increase productivity while meticulously managing costs.

One way to stay ahead of the curve is to review your telecommunications infrastructure and services to make sure they are maximizing resources, workforce productivity and efficiency. At TelePacific, we have the expertise to help you assess your current technologies, circuits, applications and usage metrics and identify solutions that enhance communications value for your company.  In fact, on a daily basis we conduct telecom audits that better align business and technology goals while reducing costs. To cite just one example, many of our customers with increasingly mobile workforces are surprised to learn that we can save them money by bundling mobile smartphones and wireless broadband solutions with their other telecom services and bill all of them on a single invoice, too.

As with the steam engine, railroads and electricity before it, computer technology is accelerating and upsetting the normal march of economic progress, but broad-based economic growth will eventually come, according to Brynjolfsson and McAfee. In the meantime, it’s probably wise to make a telecom audit a priority. If you’re interested, simply give your TelePacific representative a call to schedule one.

However, Insight Research predicts that North American service provider revenue will double in the next five years. Furthermore, In-Stat recently reported that business spending on IT and telecom products and services will grow considerably through 2015.

How do we reconcile the gloomy forecasts of economists with incredible growth projections from telecom industry analysts? More than ever, telecom is a facilitator of socio-economic advancement, and broadband and mobility are the key drivers.

Wireless broadband service revenues will grow at a CAGR of more than 45 percent, while wireline broadband services grow at about 14 percent CAGR, according to Insight. And mobile workers are dramatically changing the way enterprises approach telecom. Melanie Turek, vice president, research at Frost & Sullivan, says that about 10 percent of tablets purchased today are used for business purposes but she expects that will increase to 70 percent by 2016.

The takeaway from all this: broadband demand and mobility trends are changing the buying habits of businesses, and that will present channel partners with lucrative opportunities in the coming months and years regardless of economic conditions. The growing need for mobile and remote end user connections means broadband networking requirements both at remote sites and on a mobile basis. Moreover, as organizations increasingly put all traffic and applications on a single IP network, there are growing requirements for quality of service mechanisms, which drives demand for QoS-capable protocols such as MPLS, yet another revenue opportunity.

We at TelePacific are in a strong position to help channel partners realize higher sales and earnings from these types of products. In fact, our President and CEO Dick Jalkut recently was singled out by industry publication FierceTelecom as one of 10 telecom executives to watch, highlighting our strategic acquisitions and ongoing expansion of our service portfolio to include a wide mix of WAN, wireless, broadband and IP-based products and enhancements designed to satisfy the evolving needs of business customers.

And now we’ve opened up six new markets in Texas – a state that has added businesses and jobs at about twice the national average for the past couple of years. The metro markets:

• Austin
• Corpus Christi
• Dallas
• Fort Worth
• Houston
• San Antonio

Available products in these markets include business lines, PRI, Internet access up to 1Gbps and MPLS IP VPN services. If you have any questions about these new markets or available products, please contact your channel manager.

EoC beats TDM access prices by 15 percent or more, simplifies CPE and features a universal hand-off. It’s also faster to deploy, easier and more flexible to upgrade and it’s just as reliable as TDM access but more resilient because it’s delivered over multiple copper pairs.  

That last point is important, especially in markets affected by stormy weather. For example, in Southern California, storms frequently disrupt T-1 access. However, when tremendous rains poured down on Los Angeles last winter, not a single one of our EoC customers experienced an outage. With TDM, if any part of the copper loop fails, then the TDM circuit fails. That’s not the case with EoC because our equipment can retrain the other available loop(s) and maintain bandwidth.

Given EoC’s reliability, lower costs and performance enhancements, in the third quarter alone, hundreds of our small and medium-sized business customers upgraded from T1 and bonded T-1 access to an EoC solution at speeds up to 20 Mbps. With eight copper pair at 2,600 feet from one of our wire centers, we can achieve speeds of 35 Mbps to 40 Mbps, if needed. And our EoC footprint is growing fast. By year’s end we will have EoC in 220 wire centers throughout California and Nevada.

In addition, we’re increasingly providing multi-location customers with what we call EoX, or Ethernet over any (copper, TDM, fixed wireless and fiber), essentially mixing and matching local access technologies that provide the most cost-effective bandwidth based on each location’s needs. We’re also bundling EoC with 1Net MPLS and SmartVoice, which gives customers the ability to dynamically allocate bandwidth to data traffic when employees aren’t using their phones.

Recently, our President and CEO Dick Jalkut was singled out by industry publication FierceTelecom as one of “10 competitive telecom executives to watch.” Senior Editor Sean Buckley asserted that TelePacific, already named one of Inc. magazine’s fastest growing private companies for five years running, “will continue on a growth path with new products and enhancements designed to satisfy the multi-site business customer.”

He adds that our expanding suite of Ethernet products will play a significant role in that growth, and we couldn’t agree more. We invite you to contact us to learn more about EoC options and bundles that fit your business. And ask about our fall promotion. We’re currently giving away additional bandwidth with EoC orders.