Deutsche Telekom wants to bolster its cloud business

Deutsche Telekom said this week aims to redouble efforts to beat out big IT incumbents in the increasingly lucrative cloud services segment. Through the telco’s IT-focused subsidiary it intends to double cloud revenues over the next three years.

The company said it wants to start generating upwards of two billion euros annually from cloud services by 2018, double what it says it currently pulls in.

“At Deutsche Telekom, we want to grow by more than 20 percent each year in the field of cloud platforms, and to become the leading provider for businesses in Europe,” said Ferri Abolhassan, head of the IT Division at T-Systems.

Last year revenues from cloud solutions, in particular private cloud services, increased double digits at the firm, Abolhassan explained. But with the battle for cloud revenue heating up with more traditional IT service providers and vendors the company needs to scale up its cloud activities both within and outside T-Systems.

“The market for services from the public cloud – infrastructure, platforms and applications – that can be accessed through the public Internet promises further growth. In conjunction with partners, Deutsche Telekom plans to pit itself more strongly against the Internet corporations Google and Amazon in future. To achieve this, the departments within Deutsche Telekom’s segments are now stepping up their cloud activities across the Group,” he said, adding that DT will also continue to try and differentiate on security.

Telco’s haven’t been the natural choice for enterprise IT professionals but over the past few years many like DT have stepped up their cloud strategies, a move which largely sees them both acquiring successful cloud incumbents and integrate them into their own operations – for instance Verizon’s acquisition of Terremark, or CenturyLink’s acquisition of Savvis – and using their existing commercial telecoms and managed services clients as direct channels.

Partnerships are also key in this segment and earlier this year DT announced a flurry of cloud-centric deals with Cisco, Huawei, SAP and Salesforce. That said, the move could be a sign DT will soon ramp up partnerships with other big cloud providers or ISVs – or head down the M&A route.