IBM’s big bet on the “hybrid” multicloud, a computing environment that combines multiple cloud providers and clouds, is beginning to pay off -- and drive innovation by its partners.
This week, Big Blue made two important announcements regarding its cloud service business. The first wa s a $550M cloud services agreement with Vodafone. IBM will assume control of Vodafone’s cloud and hosting business . Big Blue will also work together to help Vodafone clients rapidly develop and deploy emerging cloud-based digital telco capabilities.
The new venture between the two l ong-term partners will help Vodafone integrate multiple clouds.
That’s an important step as the company gets ready for next stage of digital transformation driven by AI, 5G, Edge and Software Defined Networking (SDN) .
“This venture demonstrates how we’re delivering on our strategy to radically simplify Vodafone, efficiently scale our business and deepen our customer engagement through a seamless blend of cloud and connectivity,” Vodafone CEO Nick Read is quoted as saying . “By focusing on our strengths in fixed and mobile technologies and combining those with IBM’s expertise in multicloud, this new venture helps us build on the success we’ve seen to date in our cloud business and accelerate its growth.”
The second announcement is a $325-million agreement with Juniper Networks. IBM will assist the network technology company to manage multiple cloud environments, including its existing infrastructure, to help cut costs and speed its journey to the cloud.
In addition, the agreement will allow Juniper Networks to leverage IBM’s cognitive technologies and create an agile IT environment. “A key element of our digital transformation is to manage the complexities of our global operation and to get the most out of our current investments,” Bob Worrall, Chief Information Officer, Juniper Networks ,” is quoted as saying . “In working with IBM Services, we will be able to partner with them on innovative solutions for our cloud-first business model.”
Big Blue will introduce the “Factory Development” model for application management, which will help Juniper Networks improve efficiency, and cost savings , as it moves toward a cloud-native setting .
“Our work with thousands of enterprises globally has led us to the firm belief that a 'one-cloud-fits-all' approach doesn't work and companies are choosing multiple cloud environments to best meet their needs,” Jetter, Senior Vice President of IBM Global Technology Services, quoted saying. “Working with Juniper, we are integrating cloud solutions with their existing IT investments via the IBM Service Platform with Watson. This gives them the opportunity to generate more value from existing infrastructure, along with helping them manage strategic services that are critical to their business.”
Meanwhile, Red Hat shareholders voted on the proposed acquisition, which is expected to be completed in the second half of 2019.
IBM is paying bucks to acquire Red Hat. The open source technology company will bring to IBM an innovative hybrid cloud platform, and a large open source developer community.
IBM’s bet on hybrid cloud comes at a time the company is trying to reverse a prolonged decline in revenues and profit margins that has Wall Street fleeing its stock.
Equity analysts welcomed, IBM’s recent partnerships. “These partnerships are important for IBM to show that it’s one of the leading players in the fast-growing cloud market where competition is intense,” says Haris Anwar, Senior Analyst at Investing.com.
Still, he doesn’t see investor sentiment changing in the near future. “But in a broader scheme of things, this arrangement is unlikely to improve investor confidence in its share value in the short-run that has been under pressure for many years. Investors want to see positive results of the company’s turnaround efforts which have so far failed to create any excitement.”