Time Warner Cable's NaviSite Deal Makes Sense

Cloud computing is one of the fashionable terms that telecom and IT folks are throwing around. The concept has been around for years: Instead of companies buying and running their own IT infrastructures, they reach out into the public or private Internets an...

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By Carl Weinschenk, Senior Editor

Cloud computing is one of the fashionable terms that telecom and IT folks are throwing around. The concept has been around for years: Instead of companies buying and running their own IT infrastructures, they reach out into the public or private Internets and have services, applications and other elements delivered to them.

This topic has grown hotter because the networks through the cloud -- i.e., connecting client and provider -- are faster and more reliable.

It makes good sense for all companies. And it makes perfect sense for the small- and medium-size businesses (SMBs) that still are the prime candidates for cable's increasingly potent array of business services. That -- and the fact that cable operators are looking to move up the stack to service enterprises -- is why Time Warner Cable's recent acquisition of NaviSite makes perfect sense.

The cable industry wants to be more than a dumb broadband pipe between businesses and the Internet, and buying a player in the cloud and hosted services business is a good way to do so. It should be noted that last week was a good one for telecom companies buying cloud providers: Verizon -- a company TWC (as well as other operators') sales teams will see in many a prospective customer's waiting room -- said that it is acquiring Terremark Worldwide, a cloud and infrastructure provider.

Cable has been a player in business services for decades. The emergence of broadband, the search for revenue streams outside the ever-more competitive video sector and the increasing sophistication of operator networks makes business services more attractive than ever. The Time Warner Cable acquisition of NaviSite may be the first of many such deals.

Carl Weinschenk is a reporter at BTR. Reach him atcarl@broadbandtechreport.com.

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