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Page 1: How can Telco Cloud provide flexibility for traditional ... · Telco Cloud services; the lessons learnt Our Cloud portfolio has been evolving since 2007, from shared platforms in

How can Telco Cloud provide flexibility for traditional enterprise apps? _

Page 2: How can Telco Cloud provide flexibility for traditional ... · Telco Cloud services; the lessons learnt Our Cloud portfolio has been evolving since 2007, from shared platforms in

Cloud; it’s in a Telco’s DNAA common misconception is that the Cloud market is dominated by Bulk Infrastructure Players such as Amazon or Microsoft, but not everyone knows what capabilities Telcos also have in the Cloud. Telecommunication providers actually have similar business models, capabilities and infrastructure to enable them to offer an empowering and competitive Cloud service. Cloud has become a core part of a Telco’s business. Telcos historically have designed large-scaled, shared infrastructures for both consumer and enterprises. It is true

that some changes have occurred since the first PSTN to now, and that Cloud services have been constantly evolving since the early years of this 21st century. It is also true that Telcos have the demonstrated experience of building and operating these large-scale mission-critical services, proven by services such as MPLS for large enterprises in recent years.

One of the most important differences between Telcos and hyperscale is the capacity to build up the various elements of infrastructure within their own existing services. Telcos are used to partnering and often business models have been based historically

on buying technology from a 3rd party while the hyperscalers decided to design their own servers, storage and even network elements. Strategically, however, when Telco’s develop their services, they do so within common standards, for instance within the GSM Alliance which enables seamless standards within which to partner and offer a more comprehensive solution. This is the fundamental reason Telefonica took this strategy, to enable open standard guarantees to interoperate within the Telco ecosystem. Not operating within these open standards, hyperscalers are creating their own barriers which could limit their own flexibility to their clients.

On the contrary, Telcos have several advantages and several key differentiators, such as: capillary strength (capillary infrastructure, customer service and commercial power), along with data sovereignty and trusted scalable performance which all continue to make regional Telcos truly credible players in the Cloud market.

Telcos have expanded their services within a highly regulated market (especially within the EU), this has meant the investment and strategy decisions have been made very close to local jurisdictions. Hyperscalers, however, have been working in a globalized context, following the dotcom boom, but may find it more difficult to be able to offer the localized regulation compliance Telcos can facilitate.

The essence for all players in the market, however, remains the same for both sides of this argument. The final service is irrelevant: whether voice, data, computing, storage… the really important thing is the user experience, the real time response and the flexibility to fit quickly to the customer’s requirements and market needs.

From virtualisation to CloudHistory is once again repeating itself. Just like with the data center vitualization wave, large enterprises continue to adopt, adapt and alter requirements for their Cloud services. The first clients started to move, test and develop their environments towards virtual environments. Later, basic productive services, such as directory, file and print services were then also added to the virtualised environment. Today, things are very different. Over the last couple of years, enterprises wanted to engage in data center consolidation projects in order to revamp their infrastructures and improve the TCO and agility that these virtual environments provided. The virtualization technology maturity was, at that moment, unable to support intensive network rates and big computing VMs sizes. Later, after several software updates, software vendors solved their technical limitations and in 2010 many enterprises had their first fully virtualized data center. In parallel

many IT Outsourcers found within this virtualisation technology a lever to speed up the transition phases to take full control of a client’s IT departments.

What were the main advantages of this virtualisation technology?

> Reduces complexity to simplify operations and maintenance

> Improves high availability to minimize downtime and IT service disruption

> Dramatically lowers costs to redirect investment into value-add opportunities

Customers then begin to demand other features such as flexibility and pay-per-use, in turn, testing drivers to start to trial the Cloud services with the same life cycle management for their IT service catalog levering on the benefits of the Cloud.

Our Cloud portfolio has been evolving since 2007

Page 3: How can Telco Cloud provide flexibility for traditional ... · Telco Cloud services; the lessons learnt Our Cloud portfolio has been evolving since 2007, from shared platforms in

Telco Cloud services; the lessons learntOur Cloud portfolio has been evolving since 2007, from shared platforms in virtual farms to managed infrastructure based in a public Cloud portal, and then finally on to a fully virtual data center to fulfil with all requirements for large enterprises.

> Virtual Hosting, first step as an IaaS provider: IT & communications from a single point of contact

> Cloud Portal – our first self-service portal automating computing and storage layers

> Virtual Data Center – new philosophy from a Service Provider perspective

How have Telefonica evolved our Cloud service? Fundamentally, we have been listening to our clients in order to fit our services with their enterprise customer requirements. We are using the LEAN technique in the early stages of our developments, working with our customers and learning quickly to adapt main features directly in line with their demands.

What have we learned during this journey?

Cloud in enterprise is here to stay, but adaptation and flexibility is required.

While VMs lineally grow, vCPUs double their growth per year and vRAM is exponentially increasing. More powerful VMs are required due to more critical applications being virtualized in the Cloud.

The next wave; UNICA platformCombining together core and traditional communications services with Cloud platforms is a huge challenge for Telcos, yet is one which presents a unique opportunity to directly compete with the hyperscalers. If Telcos were able to put all internal IT, core and auxiliary core network services and Cloud services together, with the same underlying technology they are likely to be able to aggregate the same economy scales whilst reducing drastically the price per GB of storage or computing Ghz.

Enterprise customers and the CloudNobody doubts that the Cloud paradigm brings enormous advantages to the management of IT for enterprises and that it fosters the flexibility and growth of the IT systems. It moves the center of gravity of the enterprise IT away from the management of infrastructure to the delivery of value in terms of applications.

Therefore, any new enterprises are likely to adopt the Cloud paradigm as the core of the design of their IT strategy. This is certainly true for start-ups with a strong technological base who can develop their business around the Cloud. Only Cloud can offer them the scalability needed in order to achieve the demanding growth figures necessary for them to survive.

However, for a more traditional enterprise, there are a number of reasons why the adoption of Cloud is not so simple. The pace at which a traditional enterprise can adopt an emerging technology or paradigm is clearly slower, yet also their requirements are fundamentally different to those of a newly-born organisation.

A service provider targeting the corporate market with its Cloud services has to design the offering to fully fulfill the requirements and needs of their customers in order to be successful. At present, well-known hyperscalers are beginning to reach a size that makes them very competitive in terms of price, as well as evolving their offerings to be able to incorporate more and more functionalities at a speed never seen before in the industry.

“A Service Provider targeting thecorporate market with its Cloud services has to design

the offering to fully fulfill the requirements

and needs of their customers in order to

be successful”.

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Other service providers are being forced to look at the wishlist of the corporate IT organization to be able to compete successfully with the other players in the market.

IT in a corporate environment is incredibly complex. The organisations have been creating solutions and products over a very long period of time, with a great number of different technologies, providers, software and hardware. Quite often, each system was designed to solve a specific business requirement, and architected to provide maximum efficiency. In many organisations the IT has been fragmented: different units and groups have been building their own solutions and therefore created a number of siloes that pose a real challenge to the IT department in order to keep them up and running. This has been made worse by the increasing numbers of mergers and acquisitions in recent years in which IT departments have to maintain very different solutions working together in what are often unstable situations.

Therefore, when CIOs evaluate Cloud Solutions they frequently find that a pure standardised solution does not fit well for their business. In an ideal world, using a standardized “off-the-shelf” solution would be the option of choice. In the real world, however, a degree of personalisation is desired to be able to tailor fit their requirements. An enterprise Service Provider, therefore, needs to recognise these individual needs and then be able to implement the complete solution with minimum disruption to their customer.

Corporate customers have typically been operating their IT in Data Centers (owned or leased) and have a deep knowledge of the technologies and capabilities around them (computing, networking, security). They are able to build complex solutions, monitor and operate them. They would like to maintain the same level of control over the Cloud infrastructure as they have now on their physical one. In fact, moving to many Cloud solutions

represents a loss of functionality and control that they are not willing to accept, or that moving to a native Cloud environment creates the need of a costly and painful migration of applications that could not be carried out. Consequently, solutions that provide an equivalent level of control to the ones they are used to will have a real appeal for customers.

One of the key aspects of Cloud is the capability of self-management. Typically carried out through web portals and APIs, it empowers the IT department to increase their productivity, substituting long and tedious processes and allowing different groups within the organisation to interact directly with the portals. Corporate customers are also adopting Managed Service Models, in which they transfer the management function to the Service Provider. A combination of these two models, with the customer being able to control and supervise the elements managed by the Service Provider or a third party, is now gaining traction in

the market. It offers clear advantages over the traditional outsourcing model in which the information provided to the customer is limited and not in real time.

Another key customer requirement is how to manage their non-cloud world. Enterprises have invested huge sums of money in hardware and software that cannot simply be forgotten. It is clear that, for a considerable time, new systems and old ones will have to coexist and work together. For some enterprises, migrating certain aspects of their business to the Cloud represents a real challenge. As a consequence, offerings that make legacy and new Cloud environments work together in a seamless way will continue to receive good market acceptance.

Service Providers that are able to offer a wide portfolio, from traditional Data Center services (housing, co-location) to the newest Cloud solutions and, more importantly, orchestrate these elements to make them work together as one environment, will be able to better serve their customers.

The same old storyThe differences between a Corporate’s market and the Cloud native market will eventually blur in some years. The adoption of Cloud will follow a similar track to that of Virtualization technologies some years ago. First, non-critical or new developments were deployed in Cloud environments, then gradually core systems were eventually migrated to the Cloud. Some legacy systems may survive but it will only be within some niche applications and platforms. Whatever happens, the core element of the value proposition of a Service Provider must be the freedom for the customer to choose their desired elements. Service Providers must partner with the customer in the process of evolution of the Corporate IT to be a trusted advisor and be a creator of value and not a consumer of resources.

Born in the Cloud vs traditional ITAccording to Gartner, “enterprises have realized that the power of Cloud computing is in the speed and agility gained in developing and operating cloud-based applications”. Source: Gartner; Exploring Cloud Management Trends and the Actions to Take, 2015.

It is true that elasticity is a key feature of Cloud, and it is key, because a flexible infrastructure that can grow or shrink as business needs change, is really attractive to an enterprise wanting to become more efficient.

Nevertheless, as stated before, enterprises host a range of legacy applications which were not developed within Cloud and, therefore, the full versatility and power that Cloud can contribute to their business is being underused with their older applications unable to exploit them.

The report also comments that companies are; “refactoring existing applications to take advantage of the elasticity of the Cloud”, however in this transition period, until legacy applications can be transformed, it is necessary to use a framework which allows the coexistence of both types of applications. This is where the Hybrid Cloud plays a key role in fostering the harmony of both, since it solves the existing gap between legacy applications and new apps providing a common management interface. It also remarks the need to “Ruthlessly standardize (for both private and public Cloud computing) to enable efficient reuse and automation of the infrastructure and application services”.

With both of these concepts in mind, Telefonica’s Hybrid Cloud has been designed to follow this criteria: using both dedicated and shared infrastructure (our shared Cloud product is called Virtual Data Center). But how do you merge both Virtual Data Center and Private Cloud successfully?

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“Everything in any cloud”: Hybrid Cloud is Telefonica’s offering to their customers. Through this Hybrid Cloud, Virtual Data Center can be connected to a customer’s Private Cloud:

> Single point of management

> Option to balance loads between one and another

> Everything has the most end-user friendly interface

Telefonica’s Hybrid Cloud is a powerful, scalable option especially for customers doing business within regulatory limits, dealing with licensing issues or sensitive data. It allows customers to transfer and maximise the Cloud benefits for multiple forms of applications whether legacy or “born in the Cloud”, adapting to the specific needs of each customer.

For example:

> Can I develop a new application for my business directly in my Cloud environment? Yes, the customer can test their application in the Virtual Data Center and make use of Cloud work-load features for their production purposes. This is frequently used when developer agility is critical, they must be aware,

however, of compliance and security concerns related to the production data.

> Does a new application “born in the Cloud” need data from my Legacy Application? The solution uses Split-tier architectures to accommodate the new application in VDC and connects via high-speed communication networks to the dedicated environment in which the legacy application sits. Telefonica’s network capillarity makes this possible as a real, workable option since latency issues are minimised.

> Where are the application users? If they are geographically dispersed, a good practice would be to develop on the existing vacancy infrastructure and use public Cloud in production time to provide scalability and/or geographical coverage. This applies when there is excess private Cloud capacity capable of developing, but production applications need higher scalability or better multi-geographic capillarity.

> What about applications with unpredictable demands? For new applications with unpredictable demands, the flexibility of the shared

environments work incredibly well. Stable applications, with steady demands stay on the private Cloud. Once the unpredictable application reaches a steady state, it will be moved to private Cloud. All applications run on the same orchestration framework allowing the known advantages of operational efficiency.

> What happens if my applications or Cloud solution fails? If the production environment resides on a private Cloud, our solutions offer a disaster recovery service in our Virtual Data Center, ensuring the consistency of the data. If in the event of a disaster occurring, the service includes an automated mechanism to activate the recovery service.

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Telefonica Business Solutions

@TelefonicaB2B

Telefonica Business Solutions

About Telefonica Business SolutionsTelefonica Business Solutions, a leading provider of a wide range of integrated communication solutions for the B2B market, manages globally the Enterprise (Large Enterprise and SME), MNC (Multinational Corporations), Wholesale (fixed and mobile carriers, ISPs and content providers) and Roaming businesses within the Telefonica Group. Business Solutions

develops an integrated, innovative and competitive portfolio for the B2B segment including digital solutions (m2m, Cloud, Security, e-Health or Digital Marketing) and telecommunication services (international voice, IP, bandwidth capacity, satellite services, mobility, integrated fixed, mobile, IT services and global solutions). Telefonica Business Solutions is a multicultural organization, working in over 40 countries and with service reach in over 170 countries.

By combining both models, Telefonica offers Hybrid Cloud solutions that allow customers to build their own private Cloud for critical environments or those containing sensitive data, while also using the public Cloud for their additional consumption needs, peaks in demand, back-up environments, and much more.

At Telefonica, we predict that Hybrid Cloud will evolve from hybrid homogenous Cloud environments to orchestrate heterogeneous Cloud environments, not only based in our own Cloud options but also with other Cloud providers. The next generation Cloud services will include Cloud brokering facilities. We believe they are the ideal transition from the traditional delivery model to a new model where IT infrastructure and commodity IT services are sourced from a selection of best-in-class Service Providers.

These new components act as an over-lying layer, capable of providing an overview of how systems are supporting the business and providing consistency in terms of access. It offers customers the transparency to understand where the systems are allocated as this new layer manages the relationships between Cloud Service Providers and consumers. The solution covers different aspects, from Cloud providers’ governance processes, cost management and monitoring.

One of the main concerns of CIOs is how much money is their business is spending on IT that is not being accounted for in their IT budget. This new Cloud model also provides a valuable way of managing this ‘shadow’ IT as well as limiting the inherent risks within these practices such as information leakage or lack of control.

For more information, visit www.business-solutions.telefonica.com

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