IBM Wields SoftLayer In Cloud Battle With Amazon Web Services

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IBM lost its battle with Amazon Web Services over a coveted CIA cloud computing contract, but it's confident that a big recent cloud acquisition will help it knock AWS off its lofty perch.

SoftLayer, the public cloud vendor infrastructure-as-a-service vendor IBM acquired in July for $2 billion, is the centerpiece of a new IBM print, online and outdoor advertising campaign that seeks to change the perception that AWS is the cloud's most dominant player.

The first three ads, which debuted on Monday, make direct comparisons of where IBM stands versus AWS in terms of expertise, infrastructure and specific types of customers, Ric Telford, vice president of IBM Cloud Services, told CRN.


[Related: Amazon Wins $600 Million CIA Cloud Deal As IBM Withdraws Protest]

"This campaign is a reality check on what it means to be a leader in cloud computing. It's a way to make people aware of IBM's leadership in the space," Telford said in an interview.

SoftLayer's long history in the hosting business, and the fact that customers can purchase dedicated servers or pay based on what they use, makes it attractive to a wide range of customers, Telford said.

SoftLayer was already competing with AWS when IBM acquired it. Since the deal closed, SoftLayer has signed up more than 1,000 new customers, including many that would have otherwise gone to AWS, Telford said.

Chris Pyle, CEO of Champion Solutions Group, a Boca Raton, Fla.-based IBM partner, said the SoftLayer deal is important for IBM in terms of bringing new DNA to the company. "They're born in the cloud and they understand how to move and react quickly," he said of SoftLayer.

Last week, IBM informed customers that it's shutting down its SmartCloud Enterprise cloud IaaS service and will move them over to SoftLayer by the end of January. One IBM partner told CRN that's good news because SmartCloud Enterprise contracts have been "cumbersome," sometimes running between 30 and 40 pages long.

If a customer wanted to add something to their contract, like additional processing power, they had to change the whole statement of work, which took time to do, said the source.

However, partnering with SoftLayer hasn't traditionally been lucrative, with commissions typically "in the low double-digits," said the source, who requested anonymity to avoid damaging his relationship with IBM.

SoftLayer does about 50 percent of its business through the channel and has a program focused on hosting resellers and strategic partners such as MSPs and ISVs that deliver SaaS applications, Drew Jenkins, channel chief at SoftLayer, told CRN last month.

NEXT: Where IBM's SoftLayer Ads Will Appear

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