IBM and Telefonica Pair Up for Hybrid Cloud

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By: Mary Jander

A joint announcement by IBM (IBM) and Spain’s Telefonica S.A. aims to help enterprises shift mission-critical applications to the cloud — following trends in the IT software and telecom segments.

With a new service called Cloud Garden 2.0, Telefonica will offer an environment incorporating IBM Cloud Pak solutions and Red Hat OpenShift to help enterprises redesign their applications to run in public or private clouds, or on premises with links to clouds.

Included in the service are IBM’s tools and middleware to help developers wed application code to cloud-native languages such as MongoDB, Red Hat JBoss or AMQ, IBM WebSphere Liberty, and Redis.

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As an example of how this works, IBM and Telefonica cite an interactive information platform developed for insurance companies with Cloud Garden 2.0 by Spanish consortium TIREA (Information Technologies and Networks for Insurance Entities).

What’s In It for Telefonica

For Telefonica, the move is part of a strategy to become an ally and enabler for enterprise customers in an effort to capitalize on the $228 billion addressable market opportunity in cloud services. Unless carriers take this kind of role, experts say, they risk being sidelined by public cloud providers and other companies active in digital transformation.

Telefonica won't be left behind: Cloud Garden 2.0 is the latest in a series of Telefonica services for business customers in the areas of connectivity, cloud, Internet of Things (IoT), security, big data, and digital workplace. Telefonica offers these services to small businesses and enterprise customers in 16 countries, including the U.S., Germany, and the U.K., in addition to a range of Latin American countries.

This is also Telefonica’s second wave of services offered with IBM. But unlike the first Cloud Garden, which focused on esoteric blockchain and artificial intelligence (AI), Cloud Garden 2.0 seems to address a wider enterprise audience intent on migrating to cloud.

What’s In It for IBM

When IBM announced year-end 2020 earnings on January 21, CEO Arvind Krishna reiterated what has become his mantra — namely, that IBM’s future depends on delivering hybrid cloud solutions and artificial intelligence (AI) to corporate customers. Cloud Garden 2.0 is a specific example of what CEO Krishna refers to as “growing our hybrid cloud platform as the foundation for our clients’ digital transformations.”

The arrangement with Telefonica also illustrates IBM’s recently announced $1 billion investment in improving its ecosystem. Like the telco, IBM can’t approach the cloud market without strong partnerships. Carriers will be important value-added resellers of IBM solutions — a tack that will be even more important as enterprises move to multi-cloud networks and secure edge environments.

IBM’s investment in this strategy was evident in the IBM Cloud for Telecommunications initiative launched in November 2020, which packages a range of IBM and Red Hat solutions to aid telecom providers to “modernize” their applications and take advantage of 5G and edge opportunities.

A Growing Field

As noted, IBM and Telefonica are part of a larger trend of strategic carrier partnerships for cloud migration. Hewlett Packard Enterprise (HPE) and VMware have telecom programs as well. And a deal similar to IBM and Telefonica’s was struck in December 2020 between Deutsche Telekom and Microsoft (MSFT). Microsoft also has arrangements with Telefonica as part of its 5G-inspired Azure for Operators program. Also like IBM, Microsoft boasts AI as part of what it brings to hybrid cloud migrations.

It’s also likely that the Cloud Garden 2.0 template will be replicated with other players by both IBM and Telefonica. This is a hot area for partnerships of all kinds, as the world’s biggest carriers and IT vendors see the benefits of approaching an enormous market together.