Cisco Entering Cloud Services Market with OpenStack Tech, $1B Investment

Cisco global Intercloud set to be a network of clouds.

By Sean Michael Kerner | Posted Mar 24, 2014
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Networking giant Cisco Systems today made its boldest move yet into the cloud services marketplace with the announcement of a new Global Intercloud initiative. Cisco has pledged to invest over $1 billion in the effort over the next two years.

At the center of the Global Intercloud is the open source OpenStack cloud platform, as well as Cisco's own Application Centric Infrastructure (ACI).

Cisco first officially joined the OpenStack community in 2011 and is now a leading member of the OpenStack Foundation. Cisco has its own OpenStack edition and began offering commercially supported hardware stacks last November.

ACI is Cisco's next-generation attempt at Software Defined Networking (SDN), originally launched in November of 2013. In January of this year, Cisco announced its Intercloud initiative as an effort to help organizations bridge and federate multiple clouds together.

The new $1 billion cloud services effort is being announced as Cisco kicks off its partner conference this week. Not surprisingly, partners play a key role in the new effort. The Cisco cloud services effort today ties Cisco OpenStack, ACI and Intercloud efforts together with a go-to-market network of global partners, including Telstra, Allstream, Canopy, Ingram Micro Inc., Logicalis Group, OnX Managed Services, SunGard Availability Services and Wipro Ltd.

"The timing is right for Cisco and its partners to invest in a groundbreaking, application-centric global Intercloud to provide broader reach and faster time to market," Robert Lloyd, president of development and sales at Cisco, said in a statement. "Together, we have the capability to enable a seamless world of many clouds in which our customers have the choice to enable the right, highly secure cloud for the right workload, while creating strategic advantages for rapid innovation and, ultimately, business growth."

Taking on Amazon?

Cisco has been building its cloud services effort for years. The new effort needs to be considered in that light.

Back in 2009, Cisco CTO Padmasree Warrior emphatically stated that Cisco is not Amazon and its cloud strategy would be different. Cisco has not wavered from its strategy in the years since.

"We do not have plans to become an IT-as-a-service provider. In other words, we will enable service providers by supplying them with infrastructure rather than provide ... compute as a service," Warrior said in 2009.

Sean Michael Kerner is a senior editor at EnterpriseNetworkingPlanet and InternetNews.com. Follow him on Twitter @TechJournalist

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