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IBM Puts SoftLayer At New Cloud Unit's Core

OpenStack gains a convert as IBM adds SoftLayer acquisition (and brand) to its new Cloud Services division.

Quan said IBM "doesn't have any specific dates" at this point to describe when the conversion to OpenStack will be completed or when Power servers will be available in SoftLayer centers. But the combined Enterprise Plus and SoftLayer data centers will also be able to host a large catalog of software-as-a-service. Over the past five years, IBM has acquired 100 SaaS companies. Their products have been converted into such IBM hosted applications as IBM Sterling Transportation Manager, Emptoris Contract Management, Digital Analytics and Marketing Center.

In addition, SoftLayer has established its own reputation for hosting low latency, big data analytics running on bare metal servers using Cloudera's commercial version of Hadoop or the MongoDB NoSQL system.

As the conversion to OpenStack proceeds, IBM and its SoftLayer unit will gain a new platform from which to approach enterprise customers with the prospect of building out their private clouds in an architecture that is compatible with several public clouds.

Crosby said he wanted to compete more effectively 12 months ago as he watched Amazon Web Services start to rapidly expand its customer base. "We couldn't keep up with their brand name. I wanted a partner with the brand, with the marketing initiative" to compete.

Up until that point, SoftLayer had primarily served as infrastructure for Internet startups, smartphone application companies and online social gaming firms. About 18 months ago, SoftLayer saw an uptick in its signing up of new enterprise customers, and 12 months ago companies that had been talking about cloud computing started "spending real dollars on the cloud." SoftLayer's top 25 customer list gradually turned over to include mainly enterprise cloud users, such as Rexall, Intel, Citrix and Disney (previously it had Disney's Playdom online game unit).

IBM noticed the change as well and initiated talks with SoftLayer. Crosby said once the June 4 definitive agreement to acquire became known, SoftLayer found "we had a lot higher profile with enterprises and closed deals" that had been in the talking stage for months. His team welcomes the challenge of providing service to larger customers.

"Infrastructure-as-a-service, we have that nailed," he said.

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