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AT&T, Equinix enter new cloud services pact

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AT&T (NYSE: T) is giving its existing VPN network customers another connection option by embedding its NetBond technology into a number of Equinix's (Nasdaq: EQIX) data centers.

The NetBond technology allows business users to connect their cloud services via AT&T's private VPN networks. Because it is a private service, it is not prone to the dangers of the public Internet.

Besides providing a secure connection, NetBond dynamically allocates VPN bandwidth, allowing customers to use as much or as little as they need.

This alliance will enable other cloud providers to allow access to their services via AT&T NetBond from Equinix's growing set of global data center sites. The two companies said the new capabilities will be available in the first half of this year.

Mike Sapien, Principal Analyst – Enterprise at Ovum, said in an interview with FierceTelecom that the new alliance has potential benefits for both companies and their customers.

"AT&T gets access to Equinix's customers and becomes part of the ecosystem there for customers to use them for network, cloud services and other related services," he said. "Equinix gets access to AT&T's global network, private interconnection (NetBond) and also AT&T customers who may want to be in a neutral data center versus AT&T's data centers.

Sapien added that while the agreement is "primarily for large customers and private cloud services, there is no reason that the customers can't expand into other cloud services and public network options."

Cloud services have become a bigger factor in AT&T's business services portfolio and its overall IT infrastructure. In 2013, the telco said that it put nearly 20 percent of its internal apps into the cloud.

AT&T has been expanding its cloud strategy through a mix of its own internal capabilities and through a growing network of partners. In addition to Equinix, the service provider has established alliances with IBM (NYSE: IBM), Microsoft (Nasdaq: MSFT) and CSC.

Through an agreement it announced with CSC last year, the systems integrator will be able to deliver its BizCloud and other cloud services via AT&T's cloud infrastructure and networks, for example. 

Given their moves with Equinix and other data center providers, Sapien said that he would not be surprised if AT&T pursues similar partnerships with additional players in this market segment.

"They already have IBM, CSC and MSFT alliances around their cloud services and I expect to see more of these and potentially more global locations to both lessen the capital demand of growing data centers globally and also expanding its services into global regions for its MNC customers and others," he said. 

For more:
- see the release

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Updated article on Jan. 28 with quotes from Mike Sapien at Ovum.