Telecom: local phone exchanges give us cloud advantage

There’s 100 different arguments about how it should be defined, but there’s no doubt cloud computing is suddenly trendy.

And options are suddenly proliferating for New Zealand businesses. Local players like Iconz and Orcon are offering cloud services.

Amazon recently launched an Asia Pacific cloud service centred around a data centre in Singapore.

And last week, so did Microsoft (read NBR’s report here).

Now it’s Telecom’s turn.

The telco’s service’s division, Gen-i, is launching ReadyCloud Server.

Like other cloud services, it lets you rent computer processing power and storage that you access over the internet, rather than running it on computers inside your own business.

Gen-i Australasia chief executive Chris Quin told ReadyCloud as a natural extension to Gen-i's WAN (wide area networking) service.

Mr Quin said Telecom’s advantage was that all of its cloud services will be hosted locally.
 
Specifically, inside Telecom phone exchanges.
 
ReadyCloud kit is already inside Mayoral Drive, Auckland and Courtenay Place, Wellington exchanges and five others. All up, 17 exchanges will host Telecom’s cloud computers and storage.
 
Phone exchanges (run by Telecom's Chorus division) are spread evenly around the country, and have industrial-strength back-up power and other redundancy systems.
 
And although Mr Quin didn’t say it, local hosting also means your data doesn’t have to travel to-and-fro along the Southern Cross Cable, the only strand of fibre linking New Zealand to the outside world and (cough) not always the fastest connection in the world, or the cheapest cloud option.
 
Local hosting could be better for support, said Mr Quin.
 
“People’s concern is that if something goes wrong in the US or Asia is, ‘Will I get heard?’”
 
Doubts remain
But Ben Kepes, principal of Christchurch-based Diversity Analysis and an international commentator on cloud computing, said Telecom itself could have perception hurdles to overcome.

"Doubt remains as to whether local offerings can truly match the benefits that seasoned cloud providers such as Amazon can bring,” said Mr Kepes.

“Add to that the development capabilities that are on offer from Salesforce, Netsuite and others and the Gen-i offering is by no means a sure thing"

But overall, the commentator sees Gen-i’s launch as a positive.

"Local organisations are becoming more eager to gain the benefits that cloud computing can bring - reduced cost, scalability and agility,” said Mr Kepes.

“This desire is tempered by their concerns over where their data is located and whether or not there is local support. Moves by local players such as Gen-i will help organisations make the move to cloud computing."

Mr Kepes also has a warning for Telecom: with Amazon and Microsoft now targeting New Zealand business for their Singapore-based cloud services, the window of opportunity for local service providers is closing.

(The picture is a little more nuanced that direct competition. Gen-i’s cloud solution runs in part on Microsoft software although, as always, the Telecom services division’s approach leans toward the technology-agnostic).

ABOVE: Gen-i's ReadyCloud Sever monthly pricing.
BELOW: Setup costs (both ex GST).

So far, Telecom is only promoting one hero customer for ReadyCloud - the relatively obscure Hamilton outfit Wild Bamboo, which sells Recordbase, a software tool to manage health and disability service user records, using the Software as a Service (SaaS) delivery model and hosts the
application on Gen-i’s ReadyCloud Server.

Like others pushing a cloud service, Mr Quin pushes its advantages for start-ups who don’t want to shell out on infrastructure. Cloud computing also suits online marketing campaigns, with their unpredictable lifespan, and applications like online ticketing or financial modelling, which require short bursts of intensive computing.

But Mr Quin sees 30% year-on-year growth for cloud computing for several years to come (off what base he would not say). And the Gen-i chief executive said that in future, cloud services will become the normal way that most businesses handle their computing and storage requirements.

It better be.

The boss is watching.

On Telecom’s otherwise glum April 17 earnings downgrade conference call, chief executive Paul Reynolds went out of his way to flag ReadyCloud as the type of service that would drive future growth.

Mr Quin said Gen-i would launch a similar product into Australia in around six months.

And meantime, Orcon might want to check with the Commerce Commission if local loop unbundling will allow rivals to install their own cloud computing gear inside Telecom exchanges ...

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6 Comments & Questions

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There are so many players on the Cloud scene now, some of whom are very sophisticated,reliable and good, that adding another another one just clouds the skys!
Telecom is known for its lack of investment in its products, which often comes back to bite them, so why would you put faith in Gen i to provide good Cloud services ?
Telecom grabbing at any straws to survive maybe.

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Put my business at the end of a cable operated by Telecom after the XT fiasco? Yeah right. I will keep my servers where I can see them, thanks.

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the cynics above fail to make their case. the real question is what is the performance like.

set up a VM ( thin client / vpn scenario) in mayoral drive and operate it from say albany and taupo. what does it perform like. proof is in the pudding. IF you are in Australia read the Fin Review story this week. CBA Bank are embarking on this same strategy with gusto.

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Crikey, all we want at our local exchange is Calling Line ID. Yes its something like 20 years since this feature has been available and we have been waiting that long.
Apparently we are 'still' on a NEAX K exchange type and we should be lucky to get dial tone. Telecom I can be a supporter of yours but there are some real basic items that you cannot and will not deliver. Upgrade the software, do something to give us some services.
Im currently an Orcon customer off the Titirangi exchange (LLU) and they can give me Calling Line ID.

I have a bit of a chuckle when I call the Hell Pizza Titirangi store as the first thing they ask you is "whats your number please', no doubt so they can manually enter it into their CRM and bring up our customer profile. It sort of reminds one of the old 'cord-board' days when the operator asked the same question (that was only just back in the 80's).
regards
Peter

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whats jimmy sharkfins phone number

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set up a VM ( thin client / vpn scenario) in mayoral drive and operate it from say albany and taupo <a href="http://lookupunlistedphonenumbers.net/">Reverse Cell Phone Lookup</a>. what does it perform like. proof is in the pudding. IF you are in Australia read the Fin Review story this week. CBA Bank are embarking on this same strategy with gusto.

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