Telcos Continue to Take to the Cloud as CenturyLink Acquire Savvis

The communications service provider CenturyLink recently made a move to acquire cloud services and hosting provider Savvis in a $2.5 billion transaction, another strong signal of the significance of cloud-based services and platforms in the IT world.

CenturyLink certainly isn’t the first of its ilk to recognize the importance of needing a strong hosting and cloud offering—the move comes just a few months after Verizon’s recent acquisition of Terremark. Major providers like these—providers of all sizes, really—have been quick to recognize the opportunities awaiting them in the cloud and are scrambling to take full advantage of the migration of so many enterprises to cloud-based services.

It’s clear that CenturyLink’s strategy is all about the cloud. (The headline in the New York Times story about the news was “The $2.5 Billion Cloud Computing Deal.”) It its statement, CenturyLink stressed how the rollup will give the company global scale as a managed hosting and colocation provider, and that mor than half of its revenue will come from business services post-merger. The addition of Savvis brings CenturyLink 32 more data centers in North America, Europe and Asia, adding to the company’s existing 16 data centers in the U.S. That’s 1.9 million square feet of floor space, along with a 207,000-route mile fiber network in the U.S. and a 190,000-mile global access network.

All of that is good news for enterprise IT professionals picking their cloud provider, even if they opt not to pick CenturyLink. Large acquisitions like these are sings of a hotly competitive sector, which not only puts pressure on providers to create more innovative offerings to meet the needs of their customers but also puts downward pressure on pricing for those services. The result of industry consolidation like this should mean that, in both the short and long term, IT pros will have more options to choose from for their cloud-based needs and get more value from the services they do buy.