AT&T allocates $1B to target new cloud-based service opportunities

AT&T (NYSE: T) has hatched a plan to invest $1 billion to respond to its business customer's ongoing adoption of cloud, mobile and network services.  

The $1 billion figure, which is part of its previously announced 2011 planned $19 billion capital budget, will be directed at five key components.

Among these areas are cloud-based and emerging network services for data storage and management, and other computing needs. In addition, the telco company will focus on bringing cloud services to global enterprise networking, small businesses and the healthcare industry.

Having a cloud-based services strategy is key for wireline operators to stem both the ongoing traditional voice landline loss they are facing on the consumer market in addition to the business user's migration off legacy ATM and Frame Relay services to IP-based services such as Ethernet.

Thus far, AT&T reported that from a global enterprise perspective over 70 percent of its Frame Relay customers have transitioned to some IP-based service solution, meaning they have a

While large and small enterprises aren't going to put every part of their service infrastructure in the cloud, the cloud concept has been growing in recent years with AT&T itself offering a Security as a Service (SaaS)-based Secure E-mail Gateway service to enterprise customers.  

Feeling pressure to have a larger cloud services presence, fellow telcos CenturyLink (NYSE: CTL), TDS (NYSE: TDS), Verizon (NYSE: VZ) and Windstream (Nasdaq: WIN) have all made a number of key acquisitions in the past year to expand their data center and cloud services presence. Chief among the large cloud deals have been Verizon's acquisition of Terremark and CenturyLink's more recent proposed deal for Savvis.

For more:
- see the release
- here's FierceWireless' take

Related articles:
AT&T wireline results in Q1 reflect strong returns on consumer broadband, IP business services
Wireline in the first quarter of 2011
AT&T puts network security in the cloud

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