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January, 17th 2014

Erich Clementi, Senior Vice President, IBM Global Technology Services

Erich Clementi,
Senior Vice President,
IBM Global Technology Services

By Erich Clementi

When Thomas J. Watson Sr. renamed a small New York manufacturing firm International Business Machines in 1924, it was both a reflection of his outsized ambitions and a projection of his belief that business would go global in the 20th century. He was right on both counts. Since then, IBM has led the way in enabling companies to become multinational organizations even while it has emerged as a globally integrated enterprise–with more than 430,000 employees doing business in 170 countries.

Today, IBM is taking steps to lead yet another wave of change in business and technology—one that promises to transform organizations, business models and the way work is done. We’re taking cloud computing global.

Cloud computing offers the potential of placing information, insights and decision-making intelligence at people’s fingertips, any time and anywhere. Via the cloud, large multinational businesses can function seamlessly and smaller companies can become instantly global. But this promise can’t be fully realized without robust global networks of data centers and communications hubs that assure the highest security for data, always-on reliability and instantaneous interactions for their employees and customers alike.

So, today, we’re announcing a $1.2 billion investment that will significantly expand our cloud computing footprint by the end of 2014. We’ll deliver cloud services from 40 data centers on five continents and in 15 countries—with new additions including China, Washington, D.C., Hong Kong, London, Japan, India, Canada, Mexico City and Dallas. Next year, we plan on expanding to the Middle East and Africa. This will be the most comprehensive global cloud service any company has offered.

Lance Crosby, IBM SoftLayer CEO

Lance Crosby, IBM SoftLayer CEO

Most of the expansion will take place within our SoftLayer business, which we bought last year for $2 billion. SoftLayer offers “infrastructure as a service” — hundreds of thousands of server computers upon which our clients run applications ranging from supply chains to massively multiplayer games. SoftLayer’s roster of data centers will nearly double from 13 today to 25 when we complete this build out.

While the full benefits of this expansion will roll out over the coming months, already, today’s network of IBM cloud data centers is bringing our clients down payments on the value that is yet to come. Here are some examples:

–Italy’s UniCredit has teamed with IBM to co-create a new generation of cloud-based services to support and expand its commercial and private-banking businesses across Europe. The joint venture will also offer cloud services to other banks.

–Johnson Controls is working with IBM to use cloud-based analytics capabilities to optimize the operations of 35 plants worldwide where it makes and recycles automotive batteries.

–Silversky, a provider of cloud-based e-mail security services for 6,700 organizations around the globe, is using SoftLayer’s disaster-recovery offering to assure its customers uninterrupted protection for their data.

–London-based Multiplay hosts more than 60 online games and serves 500,000 gamers from around the world on SoftLayer’s platform.

Why is it so important to have a global cloud network? Three words: speed, security and dependability.

First, speed. Our clients want to deliver information, interactions and insights to their employees and customers without delay. Even a fraction of a second can interrupt the flow of business or spoil the fun of watching a video online or playing a multi-player game. To avoid sluggishness, it’s vital to move data and processing closer to the user.

By positioning cloud data centers in countries around the world, we will be able to assure the speediest performance for everybody involved.

Second, security. Many countries have created regulations calling for special security measures to be applied to digital medical records and other sensitive personal information. In some cases, that includes storing the information within the borders of the country.

By locating data centers in a large number of countries, we can comply with local laws and while providing local clients with all of the benefits of cloud computing.

Third, dependability. It’s not enough to have data centers distributed around the globe. They also have to be interconnected in ways that make it possible for organizations to operate seamlessly wherever they’re doing business. That means the same applications and information that are available in New York are also available in New Delhi. Far-flung pieces of organizations can interact as if they’re next door to one another. It also means that if computers in one country go off line, mirrored computers in another country can pick up the slack.

A crucial element of cloud computing dependability is the networks that connect end users to computing resources and that connect computers to one another. One of SoftLayer’s strengths is its private network. Rather than relying on the wild-and-wholly Internet for connectivity, SoftLayer operates a separate network for its traffic. This setup assures a secure and fast flow of data not just between data centers but between individual computers. Indeed the entire global network of computers operates like it’s a single massive computer.

These qualities—speed, security and dependability—will become even more important as the world enters a new era of computing, which we at IBM call the era of cognitive systems. Cognitive computers ingest huge quantities of information, learn from their interactions with humans and data, augment human thinking and interact with humans in ways that are more natural to us. The first of these systems was Watson, the computer that defeated two grand-champions on the TV quiz show Jeopardy.

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Now, IBM and other companies are busy developing cognitive services and applications. The uses of cognitive computing are practically limitless. In any situation where people are confronted with complexity and need to make decisions, there’s a role for cognitive systems—everything from doctors deciding on the best treatment for cancer to high-school seniors deciding which university to attend.

With so many uses, it’s clear that cognitive capabilities will be delivered to people via cloud services. And it’s just as clear that to deliver all of these benefits, those cloud services will have to be global.

I think of myself as a citizen of the world. I was born in the German-speaking part of Italy, and, since joining IBM I have had assignments in Italy, Austria, Germany, the UK and the United States. To me, cloud computing is a fabric that will knit the entire world closer together—businesses, economies and people. A lot of good will come of it. But, first, we have to build a robust global network of cloud data centers to turn that promise into reality.

expansion-in-cloud-computing-infographic 2


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“Cloud computing offers the potential of placing information, insights and decision-making intelligence at people’s fingertips, any time and anywhere. Via the cloud, large multinational businesses can function seamlessly and smaller companies can become instantly global.”

Posted by: TechTrendsIT
January 24, 2014
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This is Great news for our business and its growth and us as IBM employees – we are protecting our future and that has to be great news for everyone. So excellent news and thank you all for your leadership and vision. – We need to make the value visibly to all our clients & BP AND differentiate our capabilities from our competitors.

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January 23, 2014
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January 23, 2014
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Excellent. very much interesting news, More opportunities. am a advocate of Technocracy perspective, I believe its time for me to share this information to our colleagues around me, which encourage and boost their respective individual knowledge thirsty levels to higher, also believe that spreading a word of mouth is essential on this latest strategy to our IBMers.

Posted by: Sivaramakrishna Tatavarthi
January 21, 2014
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How will IBM be fighting for cloud market share RE the NSA spy scandal? 2013 hardware sales were off in China due to this. What can we do to rally in 2014?

Posted by: Kurt Schroeder
January 21, 2014
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Excellent news. This will build the backbone for us to thrive in the cloud era!Proximity to a data centers will be boon to the client to the client apart from solving the data privacy puzzle in Europe. I think IBM should target the whole cloud client spectrum from consumer all the way to enterprise. Being labelled as the provider for ‘Enterprise’ alone is not sufficient. The IT buying nature of many enterprise in this century will also be similar to that of consumers as ‘Business’ buy more computing power than the traditional IT/CIO organization. We should be very cognizant of that shift and hence the simplicity of our offerings.

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Great news for our business and its growth – We need to bring that value visibly to all our clients & differentiate our capabilities !

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Cloud computing is the future of IT. It is the future of STG, of SWG, & of Services. It is the future of IBM. Coupled with SoftLayer acquisition, these are bold game changers from IBM.

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An incredibly powerful announcement and commitment to the future of Enterprise Computing. We must now bring this capability to everyone of our SO clients around the globe…….to enhance their realization of business value from IBM, and to expand our support capabilities into new workloads.

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Great news for IBM and our Clients. The acquisition of SoftLayer and now global expansion is certainly a game changer…we have raised the bar on cloud computing. IBM is truly delivering on its promise “to be a leader in high value cloud computing.” #ibmcloud

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