AT&T Joins Cloud Computing Set

AT&T Inc. (NYSE: T) today announced a new cloud-based computing service that gives businesses near instant on-demand access to computing resources via an online portal that can be paid for using a credit card. (See AT&T Unveils Synaptic Compute.)

The Synaptic Compute as a Service (CaaS) is the third in a series of AT&T Synaptic offerings, following the already launched hosting and storage services. It will become commercially available before the end of 2009 in the U.S. and be rolled out globally in the future. (See AT&T Goes Synaptic and AT&T Makes Push Into Cloud Storage.)

To enable the service, AT&T has teamed up with VMware Inc. (NYSE: VMW), for virtualization technology, and Sun Microsystems Inc. .

AT&T is promising enterprise-grade computing capacity that can be provisioned very quickly, says Roman Pacewicz, senior vice president of Strategy and Application Services at AT&T Business Solutions.

The carrier is expecting businesses of all sizes to find multiple uses for cloud-based computing, from disaster recovery, to support of seasonal projects, to the ability to launch applications quickly without having to invest capital.

"It's a service that has a differing kind of acquisition model and consumption model," says Pacewicz. "It's very much intended to be like our storage as a service, where you can buy it online, and the billing is based on what you use. It has the flexibility that a lot of our clients want."

AT&T intends to differentiate its offering from those of IBM Corp. (NYSE: IBM) and other computing-centric companies by offering access to the AT&T Synaptic CaaS via its virtual private network (VPN), and enable its enterprise customers to unify and centrally manage their distributed network resources and applications.

"The ability to access [the service] via a private VPN differentiates us from competitors who are offering cloud-based computing over the Internet," says Pacewicz. "It allows us to be a virtual extension of the dedicated computing environment that clients have."

That’s why the VMware partnership is critical, says the AT&T man, because the virtualization specialist is a market leader that's already widely deployed by enterprises. "They're already embedded in a majority of our customers -- we think their market share is 90 percent or higher."

The combination of VMware’s technology with the virtualization done within AT&T’s data centers will, over time, enable clients to create hybrid clouds that can be used seamlessly, because the AT&T resources will look like just another instance on the client VPN, he says. Enterprises will be able to move applications or data around to fit their changing needs or demands, turning cloud computing up or down as needed.

Layered on top of that, AT&T will offer globally consistent network resources, with guaranteed low latency, performance and application acceleration, and embedded network-based security, including intrusion detection and prevention of denial-of-service attacks and other threats.

"We think we're putting together the ability to allow the customer to have a lot of control over the infrastructure," states Pacewicz.

AT&T has been steadily building on its network-based service offerings since its acquisition in 2006 of USInternetworking Inc. (See AT&T to Buy ASP.)

It rolled out the cloud computing offer following lengthy discussions with its User Advisory Councils, where the attitude toward cloud computing has been changing, Pacewicz says. In one user council, which engages Fortune 100 chief information officers, cloud computing has gone from being a niche offering, capable of supporting some safe applications or a development environment, to being a potential extension of existing computing resources, notes the AT&T man.

And as the current economic climate has made enterprises more leery of major capital expense, the ability to use cloud computing resources as needed has become even more attractive, he adds.

Unlike the hosting offer, which is based on monthly billing with a usage fee, AT&T Synaptic CaaS features an hourly consumption model, and can be paid for as part of an enterprise's networking bill or via a credit card on a one-off basis.

"We think this has very broad applicability. Customers will use it differently across the segments," claims Pacewicz. "But at a time when everyone is struggling with how to get to market quickly and create more value quickly, to reduce cycle time, this kind of on-demand computing can be a very valuable tool."

AT&T, though, is launching into a market that's already occupied by some major names, including domestic telco rival Verizon Communications Inc. (NYSE: VZ), as well as Amazon.com Inc. (Nasdaq: AMZN) and IBM. (See Verizon CaaS Is a Top Pick, Verizon Boasts CaaS Deal, Verizon Unveils Cloud Services, Amazon's Lessons for Telcos, IBM Gets Cloudy, and Google, IBM Think Cloudy.) — Carol Wilson, Chief Editor, Events, Light Reading