Microsoft Corp.'s new cloud push is creating some sunny days at Parallels Inc., the software company that automates the processes that enable broadband service providers to sell Microsoft applications as cloud services. (See Microsoft Calls On Telcos for Office 365.)

Parallels enables service providers to get into the Internet-apps business more rapidly, providing Microsoft-approved companies with the APIs [application programming interfaces] that automate the process of linking to the Microsoft cloud and handling billing and settlements. Prior to this week's Microsoft Office 365 announcement, Parallels had done major business connecting carrier clouds to its predecessor, Microsoft Business Productivity Online Standard Suite (BPOS), for companies such as Charter Communications Inc. (See Charter Clouds Up For SMBs.)

The new Microsoft cloud services are teed up well for delivering to the SMB market, says John Zanni, VP of service provider marketing and alliances for Parallels, but the more savvy service providers are adding their own differentiation to the service mix as well.

"SMBs are looking at someone to become their IT provider -- and service providers are a natural choice, because they are already getting their broadband connections and a domain from them," Zanni says. "When you look at the type of IT services they need, email is first that comes to mind, and Microsoft 365 enables them to get a business-class level of email, with calendaring and contacts. Plus Microsoft manages it and updates it."

Parallels increasingly sees service providers adding their own cloud services, hosted from their data centers, to a bundle that includes what Microsoft delivers, but offers more features like hosted PBXs, security or automated backup services.

Part of Parallels' secret sauce is an open standard it developed called APS, which helps automate the process of adding services and incorporating the way they need to be provisioned with their licensing terms, so they can be added to a service plan, Zanni says.

"Our software sits in the service provider data center and we work with them to configure that software, make sure they are on the right architecture and manage and maintain that software," Zanni comments. That includes managing Microsoft's updates and providing automated tools that troubleshoot problems.

— Carol Wilson, Chief Editor, Events, Light Reading