Dr Steve Hodgkinson, Research Director, Public Sector Technology

Telstra and Cisco have announced a first-of-its-kind alliance that signals an inflexion point in the evolution of the global infrastructure-as-a-service (IaaS) market.

Even as Australia’s largest telco, Telstra has decided that the economies of scale required for sustainable success as an IaaS provider are beyond its means. It has determined that it is better to cease investing in potentially sub-scale home-tailored cloud computing infrastructure and instead partner with a global provider of ready-to-use cloud platforms.

The alliance is a win-win arrangement: Telstra has found a way to play a stronger local game in Australia by leveraging Cisco’s global cloud muscle, while Cisco has found a way to sell its global offerings into the Australian market without needing to invest in local services capabilities on the ground.

Cloud services winners will deploy global scale locally

One of the most significant impacts …