TW Cable Makes Cloud Progress With NaviSite
NaviSite, which already delivers such services to large businesses, is starting to tailor its Service Provider Information Technology (SPIT)-based offerings for SMBs, and has been testing them out in a number of undisclosed TWC markets, NaviSite President R. Brooks Borcherding said here Wednesday on a panel about cable's new pursuit of cloud-based services.
The idea is to help Time Warner Cable's business services unit layer new offerings on top of what it already delivers to SMBs -- high-speed data, voice and, in some cases, video services. That bread-and-butter set of services helped TW Cable's business services unit achieve more than $1 billion in annual revenues (the majority from SMBs) for the first time in 2010.
Through the first six months of 2011, the unit is on a revenue run rate of $1.3 billion for the year. The addition of NaviSite's legacy business, plus its budding focus on SMBs, should see that total grow further.
NaviSite has packaged and provisioned business infrastructure services, including components such as Microsoft Corp. (Nasdaq: MSFT) Exchange and SharePoint, for years, and is now in the process of delivering those types of apps "over the wire to SMBs," noted Borcherding.
And that should just be the start. Borcherding said several other cloud offerings, including storage as a service and "virtual desktops," are already on the company's SMB roadmap. He estimates that NaviSite's data centers are already home to about 12,000 servers.
"There's a dramatic appetite for these kinds of [cloud-based] services today," he said.
And NaviSite's work with its new owner offers more evidence of cable's increasing interest in building out SPIT capabilities as business customers continue to look to communications service providers (CSPs) to manage some or all of their IT needs and help keep them ahead of the technology curve.
Other MSOs, including Comcast Corp. (Nasdaq: CMCSA, CMCSK) and Cox Communications Inc. , either have launched cloud services or have initiatives well underway. And they'll have plenty of competition from the telcos following a wave of M&A activity, including Verizon Communications Inc. (NYSE: VZ)'s acquisition of Verizon Terremark , CenturyLink Inc. (NYSE: CTL)'s purchase of Savvis (Nasdaq: SVVS), and Windstream Communications Inc. (Nasdaq: WIN)'s deal for Hosted Solutions LLC . (See Verizon Taps Terremark for $1.4B, CenturyLink Clouds Up With Savvis Buy and Windstream Buys Hosted Solutions.)
They'll also feel pressure from Amazon Web Services Inc. and Google (Nasdaq: GOOG), which are becoming cloud service providers and are positioning themselves to compete for the kind of business that service providers are targeting.
But it's all there for the taking. "Nobody has taken over this market yet, and there's a lot of opportunity," said Lynda Stadtmueller, the program director of cloud computing at Stratecast .
And CTAM is jumping in to help the cable industry get its fair share. Panel moderator Tom Cady, the senior advisor for CTAM Business Services and former XO Communications exec, said he is leading a cloud services task force for the cable marketing organization.
— Jeff Baumgartner, Site Editor, Light Reading Cable