Len Padilla, VP Product Service at NTT Communications, the international network and ICT arm of the Japan-based telco, discusses all things cloud.
Eurocomms.com: You’ve been expanding in Europe this year – tell us what’s new…
Len Padilla: In March, we acquired an 86.7 percent stake in [data centre services company] e-shelter – it’s quadrupled our presence in Europe, which pushes us towards the top of the European market and helps us remain competitive in the booming telco and cloud space.
What's the most important thing that telcos need to be aware of regarding the cloud market in Europe currently?
There are still a lot of players operating in the European cloud market, from small and regional organisations, to the bigger public cloud players like Google, Microsoft and AWS.
Going head-to-head with the latter three in particular will be very difficult, especially if an organisation plans to be a pure-play cloud vendor.
Telcos looking for success in the European cloud market need to make sure that while cloud is an important part of their offering, it is not their only one.
They need to have a wider strategy that makes use of the cloud, such as being a specialist SaaS or PaaS provider, or offering a full range of ICT services.
There’s a large London based, European network organisation that has recently announced it is getting out of the cloud market after entering it a few years ago.
This is an example of how telcos can struggle when they try to compete with already established providers.
We're seeing a lot of operators acquiring cloudcos at the moment – what are some of the key things they need to focus on to ensure they are integrated successfully?
A lot of operators are realising that it’s not easy to build a cloud business, which is why acquisition is such a key strategy for them.
One of the most difficult things for operators following an acquisition is actually integrating new people and a different company culture.
Traditional operators provide a commodity service that sales people can easily sell, so it may be difficult to get the sales team on board to sell cloud services that customers can turn on and off at will.
However, when most telcos buy a cloud company, it is not with the intention of becoming a pure-play cloud provider.
Management needs to make sure sales teams and other internal departments understand this, and importantly reiterate that cloud is just part of the overall business strategy.
Do we need a European cloudco, as Deutsche Telekom has called for?
The upcoming EU General Data Protection Regulation is going to raise the stakes for businesses operating in Europe because of stricter data protection rules and increased fines for breaking them.
So, having engagement with pan-European organisations such as Desutsche Telekom and NTT that understand the new regulation and the market is always going to be beneficial for European customers, especially in terms of data sovereignty, and also general data issues such as facilitating data replication between countries.
What type of cloud services are most in demand at the moment?
Organisations now realise that cloud has the capability of turning their IT into a more automated and industrialised machine.
It’s now not a question of whether to adopt cloud or not – things have moved on.
However, some companies are still restricted by regulations or internal governance that prohibits them from keeping data in public cloud environments.
As a result, we’re seeing a huge demand for private cloud, both on premises and in hosted facilities, as companies strive to get the best of both worlds – agility from cloud, while maintaining security.