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Operators Lack IT Expertise Needed for Cloud Services – NEC
Source: totaltele.com
Source Date: Wednesday, November 17, 2010
Focus: Information Access, E-Participation
Created: Nov 23, 2010

Vendor sees cloud services taking off in India as operators look to shore up ailing ARPUs. Operators lack the necessary experience and expertise in providing managed IT services that are needed to succeed in cloud computing, claimed NEC on Wednesday. The Japanese equipment vendor told Total Telecom during Mobile Asia Congress in Hong Kong that while telcos are able to operate networks and meet enterprises' telecom needs, providing IT services calls for a different set of skills. "Most operators have their own internal and back office IT systems that they can manage for themselves," said Toshiyuki Mineno, senior vice president of NEC. "But most operators don't have a clue about how to combine IT services with their network and then operate it as a [cloud computing] business," he said. Still, Mineno also expressed doubts over cloud service and virtualisation providers that don't own their own infrastructure but instead deliver services over the Internet. "Google, Salesforce.com and Amazon are competitors to the operators, because they're utilising their networks but also taking revenue from them…[but] they cannot provide carrier-grade services or guaranteed SLAs," he said. NEC in April announced plans as part of a strategy update to focus on offering and enabling cloud services, and Mineno claims the kit maker is ideally placed to carve out a share of the market. "We have lots of big rivals in cloud computing from both telecoms and IT – and some of them have begun to partner with one another in cloud services – but we have been working in both of these areas for a lot of years," he said. Indeed, NEC's product base covers a broad range of areas, including submarine network and mobile backhaul equipment, servers, desktop virtualisation, PC hardware and mobile handsets. "We're combining the knowledge we have in networks and IT to provide carrier-grade cloud services," commented Mineno. One market where NEC sees strong growth potential for cloud services is India, where operators are looking to ease margin pressure stemming from declining ARPUs. "Telcos are looking at how to expand their networks, but they are also looking at how to expand the range of services they offer in order to boost ARPU," said Mineno.(By Nick Wood , Total Teleco)
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