AWS is constantly cutting pricing for compute, storage and other services, and IBM SoftLayer will have to avoid getting pulled into that game, Champion Solutions Group's Pyle said.
"Cloud services are becoming so commoditized that SoftLayer and IBM are going to have to figure out how to add value in this race to zero," he said.
IBM will place its SoftLayer campaign ads on buses and strategically placed billboards, as well as at upcoming Amazon events, IBM's Telford said. Amazon will hold its AWS re: Invent conference in Las Vegas next week.
A common knock on AWS is its lack of enterprise-grade support. Telford said IBM isn't focusing on support in its current group of ads, but said future ads may highlight the superiority of IBM's support offerings.
Telford wouldn't say how much IBM is spending on the campaign, which runs through the end of the year. He said it will account for a "pretty significant chunk" of IBM's quarterly advertising budget.
"Our goal is to put the facts out there and let companies with AWS take a hard look at what we have to offer," Telford said.
While IBM fought long and hard for the $600 million, 10-year CIA cloud contract, losing it was no big deal, Telford said.
That's because IBM has won several high-profile government cloud deals recently, including a 10-year, $1 billion cloud deal with the Department of the Interior in August and a $30 million cloud contract with the General Services Administration last month.
Ultimately, IBM believes its enterprise background and SoftLayer cloud assets will help it win the hearts and minds of government agencies.
"We are by no means discouraged by the CIA situation," Telford said. "We will win more than we lose in the government space."
PUBLISHED NOV. 6, 2013