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May 22, 2012

IBM Takes Aim at Amazon

Robert Gelber

Of all the cloud providers, Amazon is currently king of the hill, and is continuing to add services up the stack in an effort to ward off growing competition. It’s only natural that the company’s position has attracted a number of challengers, among them Microsoft, HP and Google, all hoping to steal some of its thunder. IBM, too, is part of this group of vendors who are building or strengthening their own clouds – to pull in market share, certainly, but also to address the looming threat of customer attrition.

IBM cloud imageLast week, in an announcement outlining updates to their platform, the company pitched the IBM SmartCloud as a true enterprise infrastructure. IBM claims 1 million enterprise application users are utilizing their SmartCloud. The service handles $100 billion in commerce transactions annually as well as 4.5 million daily client transactions.

In what appears to be a direct response to Amazon’s collaboration with SAP, enabling their business applications to run on Amazon Web Services, IBM has unveiled its own SmartCloud for SAP applications. The service has won the confidence of PR, marketing and advertising firm Ogilvy & Mather. The outfit is migrating their SAP applications to “IBM’s state of the art, green Smarter Data Center” in Raleigh, NC.

Paul Loftus, general manager of IBM’s Global Technology Services, mentioned that IBM wants to provide added value as a cloud provider:

Companies are starting to understand that cloud is more than just about gaining efficiencies and cost savings, it’s about driving the kind of fundamental innovation that provides lasting marketplace advantage.

To Loftus’ point, IBM announced SmartCloud Enterprise 2.1, with updates including:

  • 99.9% SLA for SmartCloud Enterprise customers.
  • Upgrades to the storage persistent system and KVM hypervisors.
  • Availability of Red hat Enterprise Linux versions 5.8 and 6.2.

Big Blue highlights the use case of TopCoder, Inc., described as the largest community for software development and digital creation. With more than 400,000 members, the group develops and designs applications, graphics, and big data projects. TopCoder has adopted IBM SmartCloud Enterprise to assist with the creative process, which includes software engineering, testing, analysis and support.

Looking to augment its feature lineup, IBM is also ramping up its platform-as-a-service (PaaS) offering. The company’s SmartCloud Application Services (SCAS) graduated from beta to pilot stage on May 15th. During this phase customers will have a chance to utilize the application service at no additional charge. SCAS is expected to become generally available in the third quarter of this year.

Amazon may still be top dog, but as cloud services mature, it will face growing competition from tech industry giants. While IBM may have a smaller user base and infrastructure, it’s working hard to retain customers and to stay relevant. What’s more, the company has the capital and technological know-how to pull off a cloud coup. In the race to cloud dominance, IBM is one to watch.

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