Savvis looks to Asia and private clouds

October 9th, 2010 | by Chan Chi-Loong

During the downturn about a year ago, the American and European IT companies were freezing growth, if not pulling out of Asia all together. Now, they are all coming back to invest in what many of them perceive to be a huge growth area.

In the last few months I’ve met all kinds of IT enterprise companies — e.g. Parallels and Citrix — talking about Asia, and yes, about the cool topic of the day, clouds.

One other example is Savvis, whose CEO James Ousley I just met at a luncheon this week. Savvis is mainly a US-based — here’s a map of their datacentres globally –IT-services company. According to James, their US$857 revenues (as of the latest 2008 annual report) comes “one-third from the network, one-third from hosting, and one-third from managed services.”

Due to Savvis’ history, they have been traditionally close to the financial, followed by media markets. They hope to capitalize on their strong partnership with Thompson Reuters to grow their business globally and in the region.

Said James: “There’s not a lot of pricing pressure for managed services in the financial sector, and there’s a huge shortage in financial hubs like New York and London.” No specifics were given, but they estimate the global growth rate to be around 10 to 15 percent for IT managed services.

I had a quick catch-up with Gartner research director TJ Singh after the luncheon. TJ, who looks after outsourcing research and was at the same event, summarized succinctly the area in which Savvis plays.

“There’s definitely room for niche players in the market,” he said, pointing to their partnership with Thompson Reuters. Piggybacking their infrastructure rollout and Asia expansion on their biggest partner and customer is a pragmatic move.

Still, TJ pointed out that the space was increasingly becoming pretty crowded. “You’ve got to remember that the market is full of big IT boys like IBM and HP. Plus, you have all these big telcos in the mix — who own the network — who are squeezing from the other direction,” TJ said.

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