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CenturyLink Takes On Amazon in the Cloud

Carol Wilson
11/5/2012
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Eighteen months after buying cloud services provider Savvis (Nasdaq: SVVS), CenturyLink Inc. (NYSE: CTL) is launching a new business unit that will directly challenge Amazon Web Services LLC in the commodity cloud business.

savvisdirect was launched last week, offering self-service pay-as-you-go options for software, infrastructure, platform or storage clouds, all available in under 10 minutes, according to the company. (See CenturyLink Clouds Up With Savvis Buy.)

Savvisdirect was built from the ground up during the past year. It's a combination of CenturyLink's fiber optic network resources and data center infrastructure front-ended with a user interface that draws on Savvis's IT and cloud expertise, says Andrew Higginbotham, president of savvisdirect. Its services will be “competitively priced” with existing commodity cloud offers.

"This is part of a plan of both management teams and a part of the acquisition strategy to go do this," Higginbotham says. The move reflects work within CenturyLink to be more focused on IT services and to realign its sales force to sell more than network services into the broader business community.

To compete with Amazon and others that have been in the commodity cloud business much longer, savvisdirect built its user interface to be simple, robust, offer more features and provide pricing transparency, says Martin Capurro, director of product management, development and marketing.

The service offers a catalog of standard IT apps -- Microsoft Exchange, Sharepoint and more -- on a one-click basis, along with compute, storage and other standard cloud services. It also has click-to-chat with both sales and support capabilities.

"We know what people have been looking for in terms of service and support and we are making it easy for them to get that," Capurro says.

Savvisdirect is expected to be the gateway service for a more extensive range of Savvis cloud offerings, but that's not its main function. "We mostly see this as a way to reach a broader market," Higginbotham says. "CenturyLink has 1.7 million SMBs on its network and we think we can reach many more of those."

Pricing is one area where savvisdirect will look to compete, on both transparency and overall cost. Higginbotham says his firm's analysis of the market has found that many cloud service providers offer initial services that look inexpensive but layer on charges for add-ons such as email that can create "sticker shock" for small businesses that were looking to save money from using cloud services.

"We are very transparent in our pricing and, in our analysis. We are right out there competing with all of the market," he adds. "We think we have a unique value -- sales, scale and reputation."

— Carol Wilson, Chief Editor, Events, Light Reading

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Bayou Mtn
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Bayou Mtn,
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12/5/2012 | 5:18:02 PM
re: CenturyLink Takes On Amazon in the Cloud


A sizeable chunk of the SMBs are in the medical industry.  Does the new offer include options for HIPAA compliance?

joanengebretson
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joanengebretson,
User Rank: Light Beer
12/5/2012 | 5:17:59 PM
re: CenturyLink Takes On Amazon in the Cloud


Interesting post Carol. There seems to be a growing recognition of the importance of the network to cloud offerings. Amazon realized that & is partnering with various network operators around the world -- including Exponential-E in the U.K. -- to add value to their cloud offerings.


Perhaps CenturyLink/ Savvis will be able to leverage the fact that the combined company can offer both cloud services and network connectivity.

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