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Bob Skaggs, Columbia Pipeline Group, Enterprise IT, IBM, News & Analysis, Philip Guido

Columbia Pipeline links up with IBM in $180m cloud deal

CPG is sending most of its applications to the cloud

CPG is sending most of its applications to the cloud

Newly independent Columbia Pipeline Group (CPG) signed a $180m deal with IBM this week that will see the firm support the migration of its application infrastructure from on-premise datacenters into a hybrid cloud environment.

CPG recently split from NiSource to become an independent midstream pipeline and storage business with 15,000 miles of interstate pipeline, gathering and processing assets extending from New York to the Gulf of Mexico.

The company this week announced it has enlisted IBM, a long-time partner of NiSource, to help it migrate its infrastructure and line of business applications (finance, human resources, ERP) off NiSource’s datacenters an into a private cloud platform hosted in IBM’s datacenters in Columbus, Ohio.

The wide-ranging deal will also see CPG lean on IBM’s cloud infrastructure for its network services, help desk, end-user services, cybersecurity, mobile device management and operational big data.

“IBM has been a long-time technology partner for NiSource, providing solutions and services that have helped that company become an energy leader in the U.S.,” said Bob Skaggs, chief executive of CPG. “As an independent business, we are counting on IBM to help provide the continued strong enterprise technology support CPG needs.”

Philip Guido, general manager, IBM Global Technology Services, North America said: “As a premier energy company executing on a significant infrastructure investment program, CPG requires an enterprise technology strategy that’s as forward-thinking and progressive as its business strategy. Employing an IT model incorporating advanced cloud, mobile, analytics and security technologies and services from IBM will effectively support that vision.”

Companies that operate such sensitive infrastructure – like oil and gas pipelines – are generally quite conservative when it comes to where they host their applications and data, though the recent IBM deal speaks to an emerging shift in the sector. Earlier this summer Gaia Gallotti, research manager at IDC Energy Insights told BCN that cloud is edging higher on the agenda of CIOs in the energy and utilities sector, but that they are struggling with a pretty significant skills gap.

Docomo, GE, Internet of Things, IoT, News & Analysis, NTT

GE, NTT Docomo to form Internet of Things alliance

GE and NTT are jointly developing IoT solutions for industrial applications

GE and NTT are jointly developing IoT solutions for industrial applications

GE Energy Japan and Japanese operator NTT Docomo signed a memorandum of understanding (MoU) this week that will see the two companies commit to jointly developing Internet of Things (IoT) solutions for industrial uses.

The companies will combine GE Digital Energy’s MDS Orbit Platform, a wireless router for industrial equipment, and Docomo’s embedded communication module, which will provide remote access and monitoring capabilities.

The solution will be capable of monitoring tightly regulated (and hazardous) infrastructure like bridges and electricity, water and gas power plants for fitness and operational productivity.

The data generated by the embedded monitoring sensors will be sent to Docomo’s Toami cloud platform, designed primarily for M2M use cases, and users will be able to manage and analyse the data using strongly authenticated mobile platforms.

GE is an M2M veteran – in aviation and energy it was doing IoT well before the term became en vogue – and NTT Docomo already partners with a number of other technology incumbents embedded in the IoT arena including Panasonic and Jasper Wireless. Its parent, NTT Group, is also fairly active in other IoT initiatives. The company is working with both ARM and Intel on their respective IoT platforms.

Like many in this space the companies are keen to capture a chunk of growing IoT revenues, with the IoT and M2M communications market in particular forecast to swell from $256bn in 2014 to $947bn in 2019 (an estimated 30 per cent CAGR) according to MarketsandMarkets.

BCN and our sister publication Telecoms.com have put together a report on what the industry perceives to be the top benefits and challenges in consumer and industrial IoT. You can download it for free here.

Access Industries, Andreessen Horowitz, Ben Uretsky, DigitalOcean, Funding, IaaS, Infrastructure as a Service, Mitch Wainer, News & Analysis

Dev-focused DigitalOcean raises $83m from Access Industries, Andreessen Horowitz

DigitalOcean raised $83m this week, which it will use to add features to its IaaS platform

DigitalOcean raised $83m this week, which it will use to add features to its IaaS platform

DigitalOcean this week announced it has raised $83m in a series B funding round the cloud provider said would help it ramp up global expansion and portfolio development.

The round was led by Access Industries with participation from seasoned tech investment firm Andreessen Horowitz.

DigitalOcean offers infrastructure as a service in a variety of Linux flavours and and aims its services primarily at developers, though the company said the latest round of funding, which brings the total amount it has secured since its founding in 2012 to $173m, will be used to aggressively expand its feature set.

“We are laser­-focused on empowering the developer community,” said Mitch Wainer, co-founder and chief marketing officer at DigitalOcean. “This capital infusion enables us to expand our world­-class engineering team so we can continue to offer the best infrastructure experience in the industry.”

Although the company is fairly young, and with just ten datacentres globally it claims to serve roughly 500,000 (individual) developers deploying cloud services on its IaaS platform, a respectable size by any measure. It also recently added another European datacentre in Frankfurt back in April, the company’s third on the continent.

But with bare bones IaaS competition getting more intense it will be interesting to see how DigitalOcean evolves; given its emphasis on developers it is possible the company’s platform could evolve into something more PaaS-like.

“We began with a vision to simplify infrastructure that will change how millions of developers build, deploy and scale web applications,” said Ben Uretsky, chief exec and co-­founder of DigitalOcean. “Our investors share our vision, and they’ll be essential partners in our continued growth.”

Netflix, News & Analysis, Policy and Regulation, Spotify, taxation

Will Chicago’s “cloud tax” affect enterprise cloud services elsewhere?

Chicago is taxing some cloud services, an increasing trend in the US in recent years

Chicago is taxing some cloud services, an increasing trend in the US in recent years

Financially troubled and looking to raise funds to plug a swelling hole in the city’s budgets, Chicago recently extended its existing tax laws to levy a 9 per cent surcharge on cloud-based entertainment streaming services like Netflix and Spotify as well as certain software services hosted on cloud platforms in the city. But will the tax laws in Chicago – and elsewhere – soon be stretched to include other cloud services?

The tax law, an extension of existing laws, came from two separate rulings from the City’s Department of Finance. One covers “electronically delivered amusements”, which relates to music, TV and video streaming services like Netflix and Spotify, and another covering “nonpossessory computer leases,” which effectively includes rented storage and compute resources.

The law covering “electronically delivered amusements” doesn’t require those services to be hosted locally (only consumed locally), but the law relating to “nonpossessory computer leases” does, which means local cloud providers are due to collect 9 per cent on their transactions (the exception being when streaming data is in question / interaction with the “rented equipment” is minimal).

The reasoning for the legal reform is simple enough. Cloud is becoming the dominant means by which software and media are being delivered and consumed, and as a result web-based vendors are dominating brick-and-mortar outfits, with the city feeling the pressure from a loss of related sales and property tax revenue. Naturally, the city is looking to compensate that loss with more cash.

Some have suggested this sets a worrying precedent for the way cloud services could be taxed in the US going forward, but some legal experts believe it is not yet clear how the ruling will apply to a wide range of different kinds of cloud services in practice.

“It is likely that we will see more State and local government adopting a tax for certain services to compensate from the loss of revenue from other services that are not generating as much revenue as they did in the past,” Francoise Gilbert, managing director of the IT Law Group told BCN.

A number of US States have already determined they would tax such cloud services as a sale or license of software; information or data processing software; or a digital product or service.

New York, Colorado, Pennsylvania and Utah are all examples of States that have enacted rulings whereby remote access to software via the cloud is taxable if the software is used by in-State customer; Missouri and Tennessee also extend their tax laws to cloud services that are hosted out of State.

But some of those rulings have been challenged before, and a successful challenge can seemingly depend on how a state defines a cloud service and the level of the stack that offering sits in.

In April this year for instance the New York State Department of Taxation (which does tax some cloud services) released an advisory on a case where a company provided infrastructure-as-a-service to a business.  The Department found that the service provided by the cloud company is not taxable because it was used by one of the provider’s customers to run their own software application (advertising software).

“In purchasing an instance, a customer is provided with an operating system that is necessary for the instance to interact with Petitioner’s server network. The operating system represents prewritten software. The customer uses the operating system to perform certain administrative functions, such as to download an application, delete an application, or search for a file,” the advisory opinion reads.

“By granting the right to use the third-party operating system, Petitioner is transferring the right to use prewritten computer software within the meaning of § 526.7(e)(4) of the Sales Tax Regulations. However, a customer does not subscribe to Petitioner’s Cloud Computing product in order to use the operating system. Rather, it subscribes to the product in order to run an application of its choosing using Petitioner’s computing power. This makes Petitioner’s Cloud Computing product different from those products where the vendor’s transfer of the right to use prewritten software to the customer is what the customer primarily wants from the vendor.”

The opinion also concludes APIs do not constitute a taxable pre-written software good.

“It is not clear whether the Chicago tax decision will have an effect on cloud computing services in general.  For several years, States have examined the different categories of services and have opted, or not, to classify the service as taxable,” Gilbert explained.

But she reaffirmed that States will likely continue looking at cloud services for extra revenue, and that consumers shouldn’t write-off potential unintended consequences of taxing one class of cloud services or another – mainly, more taxation.

Cisco, M&A, MaintenanceNet, Telco Cloud, telecoms

Cisco to buy MaintenanceNet for $139m to bolster telecoms strategy

Cisco is buying MaintenanceNet for $139m

Cisco is buying MaintenanceNet for $139m

Cisco is looking to buy data analytics and business process automation specialist MaintenanceNet for $139m, the company announced this week. The networking giant said the move will help its partners capture more revenue from contract renewals, and may help strengthen its telecoms strategy.

MaintenanceNet offers data analytics and software that helps automate and manage the customer contract renewal process. It uses data analytics to aim special offers and new services at existing customers that are up for contract renewal in an automated fashion.

“This helps Cisco partners capture high-volume and low-dollar sales opportunities that may risk being overlooked. This streamlined process enables services contract opportunities to be pursued quickly and efficiently,” explained Debbie Dunnam, senior vice president of worldwide services sales at Cisco.

“MaintenanceNet will be joining Cisco’s Global Customer Success (GCS) organisation, a group dedicated to improving customer engagement and delivering a coordinated, end to end experience to our partners and customers. This acquisition is a critical component of our strategy for GCS to simplify and digitize our business processes.”

The move comes less than two weeks after Cisco paid $635m for OpenDNS, a move intended to strengthen its security services portfolio – with a particular view towards offering IoT-focused network security services.

Cisco said the MaintenanceNet purchase will enable it to further facilitate its partners’ businesses, and a segment one can imagine these kinds of capabilities being particularly relevant is telecoms, where Cisco has been working to make inroads with it Intercloud strategy – and where its business has struggled the most in recent quarters.

Telcos depend heavily on driving revenue growth through both new subscriptions and up-selling existing subscribers, not to mention keeping the subscriber attrition rate low, so anything Cisco can offer to help its partners (and itself, particularly as it goes to market with its own cloud services) achieve these goals will be a strategic imperative.

Alex Freedland, Dell, Josh Lindenbaum, Mirantis, News & Analysis, Redapt, server

Mirantis gets into the OpenStack converged infrastructure game

Mirantis is teaming up with Dell and Juniper to create converged infrastructure solutions

Mirantis is teaming up with Dell and Juniper to create converged infrastructure solutions

Mirantis unveiled plans to work with a range of vendors to deliver OpenStack-based converged infrastructure solutions for enterprises.

The Mirantis Unlocked Appliances are built by Rack Partners and come pre-validated by Mirantis with its own commercial distribution of OpenStack and pre-integrated by Certified Rack Partners.

This is Mirantis’ first big foray into the converged infrastructure area – a segment dominated by Dell and HP, which offers its own HP Helion OpenStack-based converged infrastructure solutions.

“The architecture Redapt designed with Mirantis, with Mirantis OpenStack at the core, solves for the complexity commonly associated with OpenStack,” said Josh Lindenbaum, vice president of business & corporate development, Redapt. “Redapt will work closely with customers to assemble, deliver and install Mirantis Unlocked Appliances that will arrive in the datacentre ready to plug and play.”

Its inaugural offering is tailored specifically for cloud-native applications, though it said it plans to release a broader portfolio of converged infrastructure solutions as it partners with more hardware and software vendors.

The first configuration will be built using server and networking technology provided by Dell (PowerEdge R630 servers for compute and foundation nodes and Dell PowerEdge R730xd for storage) and Juniper Networks (QFX5100s as the data path and a Juniper EX3300 for management) respectively, with configurations ranging from six compute nodes and 12 TB of storage to a full rack comprised of 24 compute nodes and 24 TB.

“About 20 percent of infrastructure is consumed through the appliance form factor because it is extremely easy to set up and operate,” said Alex Freedland, Mirantis president and co-founder.

“Mirantis Unlocked Appliances combines this ease of use with the openness and flexibility of OpenStack, delivered as a cloud-in-a-box. Our first appliance focuses on the most common OpenStack use case – developing cloud-native applications – and will be built and shipped by Certified Rack Partners across the ecosystem,” Freedland said.

Alastair Mitchell, Dods Research, Enterprise IT, Huddle, News & Analysis, Public Sector

Only one third of UK public sector comfortable with cloud – survey

Survey research reveals UK public sector workers still aren't sold on cloud

Survey research reveals UK public sector workers still aren’t sold on cloud

Only 35 per cent of public sector staff are comfortable using cloud-based services according to a survey report published this week.

The survey, commissioned by enterprise collaboration cloud service provider Huddle and carried out by Dods Research, petitioned more than 5,000 UK public sector workers on their views towards cloud services and collaboration.

According to the results just a third of public sector staff seem comfortable using cloud services, while slightly more say they have never used cloud services before.

The results come at a time when the UK government is looking to cut billions of pounds by cutting programmes and improving operational efficiency through the use of cloud services, a key pillar in its ‘cloud-first’ strategy originally revealed in 2013.

“The public sector frontline is stuck between a rock and a hard place,” said Alastair Mitchell, co-founder and chief marketing officer of Huddle.

“On the one hand, staff are being asked to remove £13bn of spend, but on the other, the new cloud-based IT infrastructures that are key to a large proportion of these savings are not yet sufficiently understood or trusted enough to be widely deployed. UK government has to up the rhetoric on cloud benefits and training, else the cuts are simply not possible,” he said.

“It’s really very simple. If public sector employees — and in particular those in IT roles — are not convinced of the benefits of cloud computing and the changes to working practices that can be delivered through it, then the £13bn public sector savings are not realistic.”

The UK government spent over £4.3bn on IT services last year, though the government has frequently said cloud services must play a leading role in reducing IT spending across the UK public sector.

Enterprise IT, ERP, Infor, Mark Humphlett, Merit Globe, Mikael Porat, News & Analysis, pharmaceuticals

Recipharm taps Merit Globe, Infor for legacy ERP modernisation

Recipharm has sent its ERP platform to the cloud

Recipharm has sent its ERP platform to the cloud

Swedish pharmaceutical manufacturer Recipharm has enlisted Merit Globe and Infor to modernise the company’s ERP systems to help reduce application fragmentation across the organisations.

Recipharm said it wanted to streamline its ERP system and reduce risk associated with its fragmented suite of legacy applications. It deployed Infor’s M3 cloud-based ERP platform to replace its existing on-premise solution.

“We can see that new features are being developed and industry-specific functionality added, removing the need for customisation.  This is critical for us as we instigate business process improvement projects,” said Mikael Porat, director of supply chain, Recipharm.

“Looking ahead we are assessing options outside of the ERP such as electronic signature , as this is of major importance for compliance within the pharmaceutical industry,” he added.

The project also included integration with a host of third party systems as well as a migration from IBM AS/400 to Microsoft SQL.

“Success in the pharmaceutical industry depends on managing two contrasting factors, continual product innovation and complete compliance with regulations,” said Mark Humphlett, director, industry and solution strategy, Infor.  “From an operational perspective this means an agile ERP and standardised processes are critical.  Customisations must be kept to a minimum and integration must be lightweight and flexible to support growth.”

Pharma is a heavily regulated industry and one of the main inhibitors when considering a shift to cloud services. Results from the BCN Annual Industry Survey earlier this year, which included responses from over 715 senior enterprise IT decision makers, suggest Pharma was among the top three least likely sectors to shift to cloud services in the next two years, Aviation and Emergency Services being the other two.

Frank van der Post, IS Group, Kpn, M&A, News & Analysis, Telco Cloud

KPN acquires cloud provider IS Group

KPN has acquired IS Group, a Dutch cloud service provider

KPN has acquired IS Group, a Dutch cloud service provider

KPN has acquired IS Group, a large Dutch hosting and cloud services provider, for an undisclosed sum. The operator said the move will help bolster its business solutions portfolio.

Founded in 1996, IS Group offers managed cloud services and virtual desktop solutions to businesses in the Netherlands.

The company only operates datacentres in the Netherlands and claims annual revenues of roughly €25m, KPN’s primary market, and although the Dutch operator already offers some cloud services to enterprises it said the acquisition would allow it to expand its managed hosting capabilities with services like cloud-based workspaces for SMEs.

“Our business customers are increasingly asking for cloud-based services to support their growth,” Frank van der PostKPN has acquired IS Group, a large Dutch hosting and cloud services provider, for an undisclosed sum. The operator said the move will help bolster its business solutions portfolio., chief operating officer of KPN. “Together with IS Group we will be better able to service our customers in their transition to the cloud, with solutions that increase efficiency and flexibility, while allowing for rapid scalability.”

The move fits with KPN’s broader strategy of divesting its operations in other European markets – Belgium and Germany – to build out a broader portfolio of services in its home market of the Netherlands. The company has been fairly proactive at bolstering its cloud cred at the same time.

Last year KPN joined the Cloud Team Alliance, a partnership inked between Belgian telco Belgacom and Numergy, a French cloud computing specialist, which enables participating organisations to extend the coverage of their cloud services by sharing networks and technical resources that help each operator optimise their network architectures for cloud computing. Earlier this year the company also joined the newly formed Dutch Datacentre Association (DDA), which represents close to two thirds of the local datacentre and cloud sector.

Cisco, Europe, Internet of Things, IoT, News & Analysis, Robert Vassoyan

Cisco bolsters IoT partnerships with French startups

Cisco is beefing up its IoT strategy and targeting French startups to do it

Cisco is beefing up its IoT strategy and targeting French startups to do it

Cisco is making good on a promise made in February to team up with the French government on a $100m initiative to help fund local Internet of Things (IoT) startups, partner with local businesses and cultivate IoT-specific skills.

Among the company’s initiatives include a competition to develop enterprise-focused IoT services and apps that foster social and environmental innovation, and a partnership with the NUMA Sprint accelerator programme which will see the company support up to 22 IoT startups incubated in the programme.

Cisco also said it’s partnering with Actility, a provider of IoT and machine-to-machine services for energy management, to improve connectivity between low-power sensors using LoRaWAN, and investing in Parisian startup 6Wind, a software firm developing software-defined networking and network function virtualisation solutions.

“Innovation is in the DNA of Cisco. France has almost limitless potential and our mission is to support innovation across our entire ecosystem,” Robert Vassoyan, chief executive of Cisco France. “These first initiatives demonstrate our active cooperation with innovative companies to aid them in their development, and show that we are committed to continuing our efforts in this area to drive growth, competitivity and employment of our country.”

Cisco has stepped up its IoT strategy as of late, most recently buying connected things tracker and network security specialist OpenDNS for $635m.