IBM, AT&T Dive Deeper Into Cloud

Updated with information on ATT.net outage

ARMONK, N.Y. ( TheStreet) - Big tech and telecom names AT&T ( T), VMware ( VMW), Sun ( JAVA) and IBM ( IBM) are ramping up their cloud computing strategies today.

Tech bellwether IBM claims to be breaking new ground in this space with the launch of its Smart Analytics Cloud, a set of technologies for firms that want to compile information across their organization. This could be, for example, a corporate sales team that needs to draw reports from multiple databases in different global divisions.

"We can set up their private cloud for them, or we can offer it as a hosted service," Linda Sanford, senior vice president of enterprise transformation, told TheStreet. "There are certain industries that will jump on it faster than others -- retail tends to be very aggressive on this and I think that the finance industry can benefit."

AT&T, VMware Meet In The Cloud

Cloud services, which typically offer computing power or data storage via the Internet, have been gaining momentum recently, with companies such as Amazon ( AMZN), Microsoft ( MSFT) and Verizon ( VZ) all pushing the technology. AT&T, for example, already offers its Webmail service, although its att.net Web site was temporarily inaccessible early Monday following a 'fiber cut'.

IBM's Smart Analytics Cloud is a set of hardware, software and services that customers use to collate information across their organization, which is then accessed through a secure Web portal. Consisting of a System z mainframe computer, the cloud package also includes IBM's Cognos business intelligence and DB2 database software.

The tech giant has already predicted that business analytics software will be one of 2010's hottest technologies. During the conference call to discuss the company's third-quarter results, IBM CFO Mark Loughridge vowed to pump profits into business analytics, which he described as a primary investment area. Since 2005, IBM has spent $9 billion on acquisitions to build its business analytics capabilities, and the technology looks set to account for a large chunk of the firm's $6 billion annual R&D budget.

IBM, like its rivals, has also thrown its weight behind cloud computing, both within its own business, and as an external revenue stream.

Sanford explained that the Smart Analytics Cloud was born out of an internal IBM project dubbed "Blue Insight," which aims to gather information from more than 100 information warehouses and data stores. Some 60,000 IBM employees will have access to Blue Insight by the end of the year, she told TheStreet, a figure which will rise to 200,000 in the next 12 to 18 months.

AT&T is another company touting new cloud technology this week, unveiling its Synaptic Compute as a Service offering. Built on hardware from Sun and software from virtualization giant VMware, the telecom firm is extending its current storage cloud into the computing arena.

Hinting that cloud is fast becoming an arms race, AT&T has made much of VMware's involvement in its new service, and is clearly looking to tap into the ongoing buzz surrounding the virtualization trailblazer.

VMware, for its part, is attempting to establish itself up as a major piece in the cloud infrastructure jigsaw. The software maker's AT&T deal comes hot on the heels of its recent partnership with Cisco ( CSCO) and EMC ( EMC).

Despite plenty of vendor hyperbole, however, cloud is still in its relative adolescence, and users are still skeptical about aspects of the technology.

A survey by the IT Industry Council (ITIC) earlier this year, for example, found that 85% of companies will not implement a cloud in 2009 because of fears that service providers may not be able to adequately secure sensitive data.

Other hurdles in the path of cloud computing include lack of standards for the technology, which has already prompted some acerbic vendor infighting and general wariness of new concepts.

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-- Reported by James Rogers in New York

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