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AT&T and IBM have formed an alliance to leverage cloud, communications, and networking technologies (T, IBM)

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US telecom AT&T and technology giant IBM have formed a strategic alliance to jointly leverage cloud, communications, and networking technologies to enhance their respective businesses, the companies announced. Cloud Strategies Lean Toward Multicloud Plans

AT&T Business Solutions will expand its existing relationship with IBM to become the company’s primary provider of software defined networking tools, while IBM will assist in modernizing AT&T Business’ internal applications and migrating them to the IBM Cloud. 

Here’s what it means: AT&T and IBM will lean on each other to shore up areas where they can use reinforcement, while simultaneously gaining new outlets for their business in their partner.

The partnership will help AT&T better tailor solutions to fit the varying needs of its enterprise customers. The telecom’s customers can have markedly different computing use cases, ranging from collecting and transmitting data from connected cars back to automakers, to providing manufacturing facility automation and optimization.

AT&T must balance these requirements with its own processing resources to deliver the digital tools and services enterprises need. Turning to IBM’s cloud-based workload management systems and tools can help AT&T do that.

For IBM, the deal will provide a major new outlet for recent acquisition Red Hat to demonstrate value. IBM offers customers a range of public and private cloud solutions, but its biggest bet has been on the hybrid cloud, where public and private cloud solutions are intermingled so that customers can benefit from the strengths of both.

This was one of the biggest driving forces behind its $34 billion purchase of open source software and services provider Red Hat. Separately, with help from AT&T to improve its networking solutions, IBM can better manage and route data from connected devices and systems to its Watson-based AI solutions — ultimately offering IBM customers more value.

The bigger picture: AT&T and IBM working together to reinforce their hybrid and multicloud products can help them compete in the crowded, top-heavy cloud platform space. 

The big 3 public cloud providers boast a huge share of the market, and AT&T and IBM have never been able to penetrate that space to a similar scale. Where both are looking to make headway and build up their business, though, is in developing services for multi- and hybrid cloud deployments.

These configurations are key parts of many businesses’ strategies: 84% of enterprises (with 1,000 or more employees) surveyed by Flexera plan to follow a multicloud strategy, with 58% pursuing hybrid cloud strategies, whereas just 10% plan to rely on a single public cloud and only 3% a single private cloud.

By partnering to augment their multi- and hybrid cloud solutions, AT&T and IBM will be in position to offer these enterprises a solution that can better fit their unique needs.

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