Why Telco’s are investing heavily in Cloud Computing?

In my precedent post - where I have analyzed the impact of Cloud computing technology on Telcos - I came to the conclusion that this impact was three fold:  Value chain, Operating Model & the need of strategic alliance.

3fold impact

“…Telecom operators are making a land grab for physical assets in order to sell virtual goods. Acquisitions and investments totaling almost US$8 billion were executed in the first six months of 2011, according to Informa’s Telecom Cloud Monitor 1H11 published on July 29^th 2011…”

Telecom Cloud purchase and build - Informa Telecom Cloud Monitor 1H11

Why are operators investing so heavily in Cloud assets? The answer is simple: they have to! They have no choice. The telecom and IT barriers are broken and in front of them the Over-The-Top players are becoming greedy and are investing the Telecom domain/market; the telcos have to restructure their business models and reorganize in order to avoid the disruption threats in the horizon.

Cloud Partnering - Informa Telecom Cloud Monitor 1H11

In North America, Telecom operators are becoming leading Cloud providers through acquisitions and investments. But are Telecom operators getting their strategy right? Are acquisitions and investments enough?


Or will they substitute dumb pipes with dumb clouds?

To be continued…