Verizon – an Internet access, telephone, and television service – announced only a few days ago that it was selling 29 of its data centers to Equinix. Recently, the New York-based service announced that it is selling its cloud and managed hosting business to IBM. The acquisition by IBM is anticipated to close later in 2017.
After Data centers, Verizon is selling its Cloud business
The move by the U.S.-based internet access service nearly puts an end to its high ambitions in relation to the Cloud. The New-York-based television service started pursuing the Cloud business back in 2011 after it bought Terremark. The internet access service bought the foundation for its private cloud businesses as well as some of the most valuable data centers – which it sold to Equinix earlier this week – with the acquisition of Terremark.
Verizon, which is the parent company of AOL that owns news outlet TechCrunch, will be working with IBM on several initiatives. In his recent announcement, George Fischer, SVP and group president of Verizon Enterprise Solutions, notes that both the internet access service and IBM will work together on a number of unspecified strategic initiatives that will include cloud and networking services.
Fischer says, “This agreement presents a great opportunity for Verizon Enterprise Solutions (VES) and our customers. It is the latest development in an ongoing IT strategy aimed at allowing us to focus on helping our customers securely and reliably connect to their cloud resources and utilize cloud-enabled applications.”
Difference between Cloud businesses of IBM and Verizon
It should be noted that last year, the New York-based internet access service closed down its public cloud service. It looks like the U.S.-based television service never touched the scale to compete with the likes of Microsoft, Amazon, and Google in the public cloud area. In addition to this, the internet access service was also not able to scale its private cloud business to the point where it was worth pursuing this strategy in the long run, particular given the solid competition in the cloud market, notes TechCrunch.
On the other hand, the cloud business of IBM is growing rapidly and quickly – unlike the other areas of its business. IBM – with its move of acquiring Verizon’s Cloud and managed hosting business – is strengthening its position in the private cloud and managed hosting space for the enterprise customers of Verizon. According to the U.S.-based internet access service, its existing customers would not see any immediate impact from this move but it possibly a fair guess that somebody from IBM will be reaching out to them soon.