Category Archives: outsourcing

Opinion, outsourcing, Private Cloud, Public Cloud

Should Public Cloud be Synonymous with Outsourcing?

Marathon runners taking the position for the start of raceI caught an internet meme the other day that said, “The Cloud is just a computer somewhere else.”  But is that true?  Is the cloud really all about outsourcing your infrastructure to somewhere or someone else?

Popular opinion seems to indicate that’s the case.  But I would argue otherwise.

The cloud is a way of thinking.  Consider the ease with which you can swipe your credit card and walk away with a virtual infrastructure in the cloud.  Pay for what you need now, and scale out to meet your growing demands as your business or projects expand.  Who could say no to that?

In my experience as an IT leader and solutions architect, this is what the cloud is really all about.  Self-service provisioning; elastic, pay-as-you-grow infrastructure; and a service-driven operating model with all-inclusive, per-VM pricing.

If we take that perspective, we see that the cloud is not just about outsourcing.  In fact, all IT leaders should aspire to deliver the same agility, elasticity, and efficiency of the cloud model – whether their infrastructure runs on-premises or “in the cloud.”

With that said, this has not always been feasible or easy.  Traditional IT infrastructure is costly, complex, and rigid.  It simply doesn’t provide the same level of efficiency and agility as public cloud providers can deliver.  And that’s no surprise.  Early in their history, pioneering service providers and technology giants like Google, Amazon, and Facebook, discarded the old IT model and built their own infrastructure based on key design principles of software-defined, scale-out, and x86 commodity hardware.

Until now, visionary IT leaders who sought to deliver a cloud operating model on-site had little at their disposal.  But that is changing.  Breakthroughs in on-premises infrastructure like hyperconvergence are making it possible to bring the benefits of the cloud on-site, avoiding the tradeoffs of outsourcing their infrastructure and core business applications to the cloud.

In many ways, hyperconverged infrastructure delivers the same efficiency and agility of cloud.  It’s based on the same design principles noted above – x86 commodity building blocks, software-defined, and linear scalability. However, hyperconverged infrastructure also provides the performance, protection, and resiliency enterprises require – all while reducing complexity and costs.

In fact, in a recent independent study, focusing on the cost-effectiveness and three-year total cost of ownership (TCO) savings of hyperconvergence and the public cloud, hyperconvergence vendor SimpliVity was compared to public cloud vendor Amazon Web Services. The study found that SimpliVity’s hyperconverged infrastructure solution offers a TCO savings of 22% to 49% when compared to Amazon Web Services. This shows that cost is no longer a barrier to creating a private cloud. Enterprises can choose what best suits their workloads, public or private.

Overall, with hyperconvergence, enterprises can now outsource to the public cloud or decide to stay on-premises, all the while maintaining the agility, elasticity, and cost-effectiveness of the public cloud.

Written by Rich Kucharski, Vice President of Solutions Architecture at SimpliVity

Atos, M&A, Managed services, Michel-Alain Proch, News & Analysis, outsourcing, Thierry Breton, Xerox

Atos completes acquisition of Xerox’s IT outsourcing biz

Atos has finalised the acquisition of Xerox's outsourcing business

Atos has finalised the acquisition of Xerox’s outsourcing business

French IT services outfit Atos announced this week the company has completed its €811m acquisition of Xerox’s IT outsourcing business, a move the companies said would give the combined entity a massive leap forward in the outsourcing market.

Originally announced on the tail end of last year Atos and Xerox agreed to a net total acquisition price of $966m (€ 811m), composed of $950m and an additional $50m assuming certain performance metrics were hit, plus $100m representing the estimated value of future tax benefits to Atos.

Xerox’s ITO business includes about 9,800 employees in 45 countries, with most – 4,500 – based in the US and more than 3,800 in global delivery countries.

Atos said the move, which gives it some strong capabilities in business process outsource and document outsourcing, means North America becomes its largest segment. While the company is popular in the Europe and the UK it’s currently ranked number 9 in North America in terms of outsourcing revenue.

“Today marks a major step in the development of the Atos Group, as we welcome 9,600 Xerox ITO employees to Atos,” said Thierry Breton, Chairman and chief executive of Atos. “With the US now our largest market, we have a stronger and more balanced global presence, which combined with our digital skills, allows us to be the trusted partner for our clients’ digital journey anywhere in the world.”

The companies also announced a deal that would see Atos become one of Xerox’s primary IT service providers globally.

Michel-Alain Proch, group senior executive vice president and recently appointed chief executive of Atos’s North American operations added: “Together with Xerox teams, we have worked extensively to be ready from day one post-closing and we are now fully operational to ensure continued delivery of services to our clients while at the same time leveraging the combined strengths of the two groups for profitable growth.”