Contributed by David Flesh, Sr Manager, Product Marketing, Cisco Network Management Technology Group
Many service providers today are implementing or investigating cloud computing to take advantage of its inherent operational advantages and as a platform from which to offer differentiated cloud-based services. By abstracting IT resources and services from the underlying infrastructure, service providers are achieving highly elastic, multitenant environments and savings. For example, cloud-based environments facilitate provisioning in minutes; time-to-market reductions of more than 50 percent; high server and storage utilization; 50 percent reductions in capital costs; and 25 to 30 percent reductions in operational costs. 1
At the same time, cloud-based services are highly attractive to providers’ enterprise customers. Service provider-based cloud services offer greater scalability and performance without requiring premises-based infrastructure and management. Self-service, scale-on-demand, and pay-per-use features increase user convenience and IT flexibility, while automated recovery and cloud-based backup significantly enhance risk management.
The good news is that service providers today are uniquely positioned to take advantage of cloud computing. Infrastructure as a service (IaaS) – a cloud utility architecture – provides an easy entry point for many service providers who are already expert at provisioning, managing, and scaling infrastructure-based services for multiple customers. IaaS helps enable service providers to increase return on investment through existing infrastructure and to deliver high-margin multitenancy services and support new competitive offerings. According to the Cisco Internet Business Systems Group, a 2009 study has forecast IaaS service revenues to be approximately $15.6 billion by 2013.