Cisco to Invest $1 Billion in Cloud Efforts
Cisco Systems is teaming up with a wide range of partners and investing $1 billion over the next two years to build on its vision of a series of interconnected clouds through which the networking giant will be able to deliver applications and services.
The OpenStack-based "global intercloud" will expand on the cloud offerings Cisco already has on the market—from WebEx and Cloud Web Security to cloud infrastructure solutions, such as the Unified Computing System (UCS) and the company's Application Centric Infrastructure (ACI)—and will enable the vendor to compete with the likes of Amazon Web Services in the rapidly growing cloud space.
Rather than just offer a Cisco-based cloud solution, company officials see the Intercloud as a connected family of distributed cloud environments that can quickly and securely deliver applications and services, and is built for the Internet of everything (IoE), with real-time analytics, high scalability and a global reach. The Intercloud will support a wide range of hypervisors, interoperate with other clouds, and enable organizations to work across public clouds or between public and private environments, according to the company.
It also addresses what Cisco officials said are rising concerns over the sovereignty issues regarding data.
"We saw an exciting opportunity to do much more than was being offered in the market by any other cloud provider," Rob Lloyd, president of development and sales at Cisco, said in a post on the company blog. "We saw an opportunity to help customers simplify the creation of hybrid cloud environments. We saw an opportunity to expand the portfolio of cloud services we deliver. We also saw an opportunity to share risk with our customers, resellers and service provider partners by building a global Intercloud—a network of clouds—that could be leveraged to help partners and service providers bring new services to market more quickly."
Another opportunity is to expand the size of the cloud space that Cisco and its partners can play in, growing it from $22 billion last year to $88 billion in 2017, he said.
Cisco officials made the announcement March 24 at its Partner Summit in Las Vegas, building off statements they made about an intercloud in January at its Cisco Live event.
The vision of a series of connected clouds is a significant one in the industry, according to Zeus Kerravala, principal analyst at ZK Research.
"While there are many cloud offerings on the market today, the [Cisco] Global Intercloud differs in many ways. The first and most meaningful difference is that while all current cloud offerings exist as one-off solutions, the Intercloud is a network of clouds," Kerravala wrote in a column on the Seeking Alpha Website. "A single cloud service obviously has value, but a collection of connected clouds has exponentially more value."
Cloud services like Amazon Web Services will continue to offer small and midsize businesses a lot of value, but a series of interconnected clouds should gain the interest of enterprises looking to use the cloud as their IT platforms, he wrote.
"Without something like Intercloud, any business looking to leverage the cloud globally would either have to try and build the connectivity tissue themselves, a extremely difficult task, or pick and choose cloud services for specific, tactical use cases but could not build a long-term, strategic road map," Kerravala wrote.
Almost a dozen tech vendors have signed up as partners or supporters of the Intercloud idea, from Telstra and Allstream to Ingram Micro, MicroStrategy and Logicalis Group. Branded services Cisco will look to offer via the Intercloud include platform as a service (PaaS) and infrastructure as a service (IaaS), WebEx collaboration, virtual desktops-as-a-service from Cisco, VMware and Citrix Systems, unified communications solutions, Videoscape Cloud DVR and management services.
Cisco will have a number of top-tier vendors to compete with in the cloud space, including Amazon, Rackspace and Microsoft. IBM also is rapidly expanding its cloud capabilities.
Cisco officials define the IoE as the "networked connection of people, data, processes and things," which they say includes the burgeoning Internet of things market. They have said the Internet of everything could represent a $19 trillion opportunity for businesses worldwide over the coming decade. CEO John Chambers has called it the biggest transition in the tech industry since the Internet.