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Cisco Unveils $1B Cloud Plan

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NEW YORK ( TheStreet) -- Networking giant Cisco says it's expanding its cloud computing services with a heavy application-development focus at a scale that will send ripples through the cloud sector.

"We absolutely intend to disrupt the cloud marketplace with this play," Mike Riegel, Cisco Cloud's vice president of marketing told TheStreet. "The market for cloud has really shifted and that's why we're making the investment. The first phase of cloud was all about infrastructure, but it's not about that anymore. It's all about the apps, and how applications perform in the cloud."

"We're absolutely not competing with AWS [Amazon Web Services] ," he added.

On Monday, Cisco unveiled an investment worth more than $1 billion to launch the world's largest global Intercloud over the next two years. This open network of clouds will be hosted across a global network of Cisco and partner data centers featuring application process interfaces (APIs) for rapid application development, built out as part of an expanded suite of value-added application- and network-centric cloud services. Cisco says the services will accelerate the opportunities created by the Internet of Everything for businesses, service providers and resellers of all sizes, who will now begin to be able to go to this network of clouds to choose from an expansive variety of offerings while still maintaining a single set of capabilities.

The global partners Cisco expects to work with for the build-out of the expanded cloud business include Australian service provider Telstra, wholesale technology distributor Ingram Micro and SAP , among other dozens of the world's largest companies.

"That's very, very distinct from what other companies are doing, where they're all investing to create their own individual large cloud," Riegal continued. "Between Cisco and our partners, we'll have a very rich set of capabilities because the reality is no single cloud can meet every customer's needs."

"And so another the reason why we're going to disrupt the cloud market with this play is that with the way the cloud is evolving right now, by bringing together a very broad network of partners, which is what Intercloud technically is, we're going to have unmatched capabilities to offer our clients."

Riegel said the global Intercloud differentiates itself from Amazon Web Services in five ways. First, its focus will be on apps, not the infrastructure. Secondly, he explained, Cisco is the only company that can provide quality of service from the network all the way up to the application. Cisco has also designed the Intercloud for local data sovereignty in the post Eric Snowden era, where customers increasingly request that their data stay in their own home countries or the particular countries where they do business.

The fourth big difference is the Intercloud is firmly based on an open model, or open source innovation based on OpenStack. The last difference is the Cisco network will incorporate real-time analytics.