AT&T provides a range of cloud services including virtual private clouds, platform as a service, and storage as a service to meet customers' evolving business and technology demands. They leverage their networking expertise and VMware technology to allow customers to extend their private VMware clouds into AT&T's public cloud network, providing security, performance and cost benefits. This hybrid cloud model lets customers burst workloads into AT&T's cloud infrastructure on demand using their existing VMware tools.

1. AT&T Provides Range of Cloud Services to Meet Customers'
Evolving Demands for Business and Technology
Transcript of a BriefingsDirect podcast on how telecom giant AT&T is leveraging its networking
and cloud expertise to provide advanced cloud services.
Listen to the podcast. Find it on iTunes. Sponsor: VMware
Dana Gardner: Hi, this is Dana Gardner, Principal Analyst at Interarbor Solutions, and you're
listening to BriefingsDirect.
Today, we present a sponsored podcast discussion on how global telecommunications giant
AT&T has created advanced cloud services for its customers. We'll see how
AT&T has developed the ability to provide virtual private clouds and other
computing capabilities as integrated services at scale.
Stay with us now to learn more about building the best infrastructure to handle
some of the most demanding network and compute services for one of the
world's largest service providers. Here to share her story on building top-
performing infrastructure is Chris Costello, Assistant Vice President of AT&T Cloud Services.
Welcome, Chris.
Chris Costello: Thank you, Dana.
Gardner: Just to help us understand, because it's such a large company and you provide so many
services, what cloud services generally is AT&T providing now, and why is this an important
initiative for you?
Costello: AT&T has been in the hosting business for over 15 years, and so it was only a natural
extension for us to get into the cloud services business to evolve with customers' changing
business demands and technology needs.
We have cloud services in several areas. The first is our AT&T Synaptic Compute as a Service.
This is a hybrid cloud that allows VMware clients to extend their private clouds
into AT&T's network-based cloud using a virtual private network (VPN). And it
melds the security and performance of VPN with the economics and flexibility of
a public cloud. So the service is optimized for VMware's more than 350,000
clients.
If you look at customers who have internal clouds today or private data centers,
they like the control, the security, and the leverage that they have, but they really
want the best of both worlds. There are certain workloads where they want to burst into a service
provider’s cloud.

2. We give them that flexibility, agility, and control, where they can simply point and click, using
free downloadable tools from VMware, to instantly turn up workloads into AT&T's cloud.
Another capability that we have in this space is AT&T Platform as a Service. This is targeted
primarily to independent software vendors (ISVs), IT leaders, and line-of-business managers. It
allows customers to choose from 50 pre-built applications, instantly mobilize those applications,
and run them in AT&T's cloud, all without having to write a single line of code.
So we're really starting to get into more of the informal buyers, those line-of-business managers,
and IT managers who don't have the budget to build it all themselves, or don't have the budget to
buy expensive software licenses for certain application environments.
Examples of some of the applications that we support with our platform as a service (PaaS) are
things like salesforce automation, quote and proposal tools, and budget management tools.
Storage space
The third key category of AT&T's Cloud Services is in the storage space. We have our AT&T
Synaptic Storage as a Service, and this gives customers control over storage, distribution, and
retrieval of their data, on the go, using any web-enabled device. In a little bit, I can get into some
detail on use cases of how customers are using our cloud services.
Gardner: Thank you. It sounds like you're being quite aggressive. So this is a very important
initiative for you, particularly, I imagine, for your business customers.
Costello: This is a very important initiative for AT&T. We're seeing customer demand of all
shapes and sizes. We have a sizable business and effort supporting
our small- to medium-sized business (SMB) customers, and we have
capabilities that we have tailor-developed just to reach those
markets.
As an example, in SMB, it's all about the bundle. It's all about simplicity. It's all about on
demand. And it's all about pay per use and having a service provider they can trust.
In the enterprise space, you really start getting into detailed discussions around security. You also
start getting into discussions with many customers who already have private networking
solutions from AT&T that they trust. When you start talking with clients around the fact that they
can run a workload, turn up a server in the cloud, behind their firewall, it really resonates with
CIOs that we're speaking with in the enterprise space.
Also in enterprises, it's about having a globally consistent experience. So as these customers are
reaching new markets, it's all about not having to stand up an additional data center, compute
instance, or what have you, and having a very consistent experience, no matter where they do
business, anywhere in the world.

3. Gardner: Let’s look into your role Chris as an IT executive and also a woman. The fact is that a
significant majority of CIOs and IT executives are men, and that’s been the case for quite some
time. But I'm curious, does cloud computing and the accompanying shift towards IT becoming
more of a services brokering role change that? Do you think that with the consensus building
among businesses and partner groups being more important in that brokering role, this might
bring in a new era for women in tech?
Costello: I think it is a new era for women in tech. Specifically to my experience in working at
AT&T in technology, this company has really provided me with an opportunity to grow both
personally and professionally.
I currently lead our Cloud Office at AT&T and, prior to that, ran AT&T’s global managed hosting
business across our 38 data centers. I was also lucky enough to be chosen as one of the top
women in wireline services.
What drives me as a woman in technology is that I enjoy the challenge of creating offers that
meet customer needs, whether they be in the cloud space, things like driving eCommerce, high
performance computing environment, or disaster recovery (DR) solutions.
I love spending time with customers. That’s my favorite thing to do. I also like to interact with
many partners and vendors that I work with to stay current on trends and technologies. The key
to success of being a woman working in technology is being able to build offers that solve
customers' business problem, number one.
Articulating value
Number two is being able to then articulate the value of a lot of the complexity around some of
these solutions, and package the value in a way that’s very simple for customers to understand.
Some of the challenge and also opportunity of the future is that, as technology continues to
evolve, it’s about reducing complexity for customers and making the service experience
seamless. The trend is to deliver more and more finished services, versus complex infrastructure
solutions.
Gardner: It’s a very interesting period. Do you have any sense of a future direction in terms of
IT roles? Does the actual role, whether it’s a man or woman, shift? The leadership in IT, how is
that changing?
Costello: I've been in the technology space for a number of years at AT&T and I've had the
opportunity to interact with many women in leadership, whether they be my peer group,
managers that work as a part of my team, and/or mentors that I have within AT&T that are senior
leaders within the business.

4. I've worked with several women in leadership. I think that trend is going to continue. I also
mentor three women at AT&T, whether they be in technology, sales, or an operations role. So I'm
starting to see this trend continue to grow.
Gardner: You have a lot of customers who are already using your network services. It seems a
natural extension for them to look to you for cloud, and now you have created these, as I have
seen it termed, virtual private clouds.
From what you're describing, that allows folks to take whatever cloud activities they've got and
be able to burst those into your cloud, and that gives them that elasticity. I imagine there are
probably some good cost-efficiencies as well.
Costello: Absolutely. We've embedded cloud capabilities into the AT&T managed network. It
enables us to deliver a mobile cloud as well. That helps customers to transform their businesses.
We're delivering cloud services in the same manner as voice and data services, intelligently
routed across our highly secure, reliable network.
AT&T's cloud is embedded in our network. It's not sitting on top of or attached to our network,
but it's fully integrated to provide customers a seamless, highly secure, low-latency, and high-
performing experience.
Gardner: Let’s look into the VMware solution set, and why you chose VMware. Maybe you can
explain the process. Was this a data-driven decision? Was this a pure architecture? Were there
other technology or business considerations? I'm just trying to better understand the lead-up to
using vCloud Datacenter Services as a core to the AT&T Synaptic Compute as a Service.
Multiple uses
Costello: AT&T uses VMware in several of our hosting application and cloud solutions today.
In the case of AT&T Synaptic Compute as a Service, we use that in several ways, both to serve
customers in public cloud and hybrid, as well as private cloud solutions.
We've also been using VMware technology for a number of years in AT&T’s Synaptic Hosting
offer, which is our enterprise-grade utility computing service. We've also been serving customers
with server virtualization solutions available in AT&T data centers around the world and also can
be extended into customer or third-party locations.
Just to drill down on some of the key differentiators of AT&T Synaptic Compute as a Service,
it’s two-fold.
One is that we integrate with AT&T private networking solutions. Some of the benefits that
customers enjoy as a result of that are orchestration of resources, where we'll take the amount of
compute storage and networking resources and provide the exact amount of resources at the
exact right time to customers on-demand.

5. Our solutions offer enterprise-grade security. The fact that we've integrated our AT&T Synaptic
Compute as a Service with private networking solution allows customers to extend their cloud
into our network using VPN.
Let me touch upon VMware vCloud Datacenter Services for a minute. We think that’s another
key differentiator for us, in that we can allow clients to seamlessly move workloads to our cloud
using native VMware toolsets. Essentially, we're taking technical complexity and interoperability
challenges off the table.
As an example, an engineering firm can now perform complex mathematical computations and
extend from their private cloud into AT&T’s hybrid solution instantaneously, using their native
VMware toolset.
How this manifests itself in terms of client solutions is that an engineering firm can now perform
computationally intensive complex mathematical modeling on the fly and on demand using
AT&T Synaptic Compute as a Service.
Medical firms can use our solutions for medical imaging to securely store and access x-rays.
Companies that are interested in mobile cloud solution can use AT&T’s Mobile Enterprise
Application Platform to offer product catalogs in the cloud with mobile access.
Gardner: It certainly appears to me that we're going to be finding a lot more ways in which the
private cloud infrastructure in these organizations can synergistically add value and benefit from
public cloud services.
Cloud interaction
Even though we want to distill out the complexities, there’s something about the interactions
between the private cloud and the enterprise and the public cloud services, like AT&T, that
depend on some sort of a core architecture. How are you looking at making that visible? What
are some of the important requirements that you have for making this hybrid cloud capability
work?
Costello: One of the requirements for a hybrid cloud solution to be a success, specifically in
terms of how AT&T offers the service, is that we have a large base of customers that have private
networking solutions with AT&T, and they view their networks as secure and scalable.
Many of our customers that we have today have been using these networks for many years. And
as customers are looking to cloud solutions to evolve their data centers and their application
environment, they're demanding that the solution be secure and scalable. So the fact that we let
customers extend their private cloud and instantly access our cloud environment over their
private network is key, especially when it comes to enterprise customers.

6. Secondly, with the vCloud Datacenter program that we are part of with VMware, letting
customers have access to copy and paste workloads and see all of their virtual machines, whether
it be in their own private cloud environment or in a hybrid solution provided by AT&T, providing
that seamless access to view all of their virtual machines and manage those through single
interface, is key in reducing technical complexity and speeding time to market.
Gardner: I should also think that these concepts around the software-defined datacenter and
software-defined networking play a part in that, is that something that you are focused on?
Costello: Software-defined datacenter and software-defined networks are essentially what we're
talking about here with some uniqueness that AT&T Labs has built within our networking
solutions. We essentially take our edge, our edge routers, and the benefits that are associated with
AT&T networking solutions around redundancy, quality of service, etc., and extend that into
cloud solutions, so customers can extend their cloud into our network using VPN solutions.
Gardner: As you moved towards this really important initiative, what were some of the other
requirements you had in terms of functionality for your infrastructure? What were you really
looking for?
Costello: In terms of functionality for the infrastructure, if we start with enterprise, the security
aspects of the solution had to prove out for the customers that we do business with. When you
think about clients in financial services, the federal government, and healthcare, as examples, we
really had to prove that the data was secure and private. The certifications and audits and
compliance that we were able to provide for our customers were absolutely critical to earning
customers’ business.
We're seeing more and more customers, who have had very large IT shops in the past, who are
now opening the door and are very open to these discussions, because they're viewing AT&T as a
service provider that can really help them to extend the private cloud environment that they have
today. So security is absolutely key.
As I mentioned earlier, networking capabilities are very attractive to the enterprise customers
that we're talking to. They may think. "I've already invested in this global managed network that
I have in multiple points around the world, and I'm simply adding another node on my network.
Within minutes I can turn up workloads or I can store data in the cloud and only pay for the
resources that I utilize, not only the compute and/or storage resources, but also the network
resources."
Added efficiency
Previously many customers would have to buy a router and try to pull together a solution on
their own. It can be costly and time consuming. There's a whole lot of efficiency that comes with
having a service provider being able to manage your compute storage and networking
capabilities end to end.

7. Global scale was also very critical to the customers who we've been talking to. The fact that
AT&T has localized and distributed resources through a combination of our 38 data centers
around the world, as well as central offices, makes it very attractive to do business with AT&T as
a service provider.
Also, having that enterprise-grade customer experience is absolutely critical to the customers
who do business with AT&T. When they think of our brand, they think of reliability. If there are
service degradation or change management issues, they want to know that they've got a resource
that is working on their behalf that has technical expertise and is a champion working proactively
on their cloud environment.
Gardner: You mentioned that it's a natural extension for those who are using your network
services to move towards cloud services. You also mentioned that VMware has somewhere in the
order of 350,000 customers with private-cloud installations that can now seamlessly move to
your public-cloud offering.
Tell me how that came about and why the VMware platform, as well as their installed base, has
become critical for you?
Costello: We've been doing business with VMware for a number of years. We also have a utility-
computing platform called AT&T Synaptic Hosting. We learned early on, in working with
customers’ managed utility computing environments, that VMware was the virtualization tool of
choice for many of our enterprise customers.
As technologies evolved over time and cloud technologies have become more prevalent, it was
absolutely paramount for us to pick a virtualization partner that was going to provide the global
scale that we needed to serve our enterprise customers, and to be able to handle the large amount
of volume that we receive, given the fact that we have been in the hosting business for over 15
years.
As a natural extension of our Synaptic Hosting relationship with VMware for many years, it only
made sense that we joined the VMware vCloud Datacenter program. VMware is baked into our
Synaptic Compute as a Service capability. And it really lets customers have a simplified hybrid
cloud experience. In five simple steps, customers can move workloads from their private
environment into AT&T's cloud environment.
Think that you are the IT manager and you are coming into start your workday. All of a sudden,
you hit 85 percent utilization in your environment, but you want to very easily access additional
resources from AT&T. You can use the same console that you use to perform your daily job for
the data center that you run in-house.
In five clicks, you're viewing your in-house private-cloud resources that are VMware based and
your AT&T virtual machines (VMs) running in AT&T's cloud, our Synaptic Compute as a
Service capability. That all happens in minutes' time.

8. Fantastic discussions
I've been in the hosting business and application management business for many years and have
seen lots of fantastic discussions with customers. The whole thing falls apart when you start
talking about the complexities of interoperability and having to write scripts and code and not
being able to accept tools that the clients have already made investments in.
The fact that we're part of the vCloud Datacenter program provides a lot of benefits for our
clients, when you talk to customers about the benefit of running that cloud in AT&T's network.
Some of the additional benefits are no incremental bandwidth needed at the data center and no
investment in a managed-router solution.
We have patented AT&T technology that completely isolates traffic from other cloud traffic. The
network and cloud elasticity work in tandem. So all of this happens on the fly, instantaneously.
Then, all of the end-to-end class of service prioritization and QoS and DDOS protection
capabilities that are inherent in our network are now surrounding the compute experience as
well.
Gardner: We've certainly seen a lot of interest in this hybrid capability. I wonder if you could
help me identify some of the use cases that this is being employed with now. I'm thinking that if I
needed to expand my organization into another country or to another region of the world, given
your 38 data centers and your global reach, I would be able to take advantage of this and bring
services to that region from my private cloud pretty rapidly.
Is that one of the more popular use cases, or are there some others that are on the forefront of this
hybrid uptake?
Costello: I speak with a lot of customers who are looking to be able to virtually expand. They
have data-center, systems, and application investments and they have global headquarters
locations, but they don't want to have to stand up another data center and/or virtually expand and/
or ship staff out to other location. So certainly one use case that's very popular with customers is,
"I can expand my virtual data-center environment and use AT&T as a service provider to help me
to do that."
Another use case that's very popular with our customers is DR. We see a lot of customers looking
for a more efficient way to be able to have business continuity, have the ability to fail over in the
event of a disaster, and also get in and test their plans more frequently than they're doing today.
For many of the solutions that are in place today, clients are saying they are expensive and/or
they're just not meeting their service-level agreements (SLAs) to their business unit. One of the
solutions that we recently put in place for a client is that we put them in two of AT&T's
geographically diverse data centers. We wrapped it with AT&T's private-networking capability
and then we solutioned our AT&T Synaptic Compute as a Service and Storage as a Service.

9. The customer ended up with a better SLA and a very powerful return on investment (ROI) as
well, because they're only paying for the cloud resources when the meter is running. They now
have a stable environment so that they can get in and test their plans as often as they'd like to and
they're only paying for a very small storage fee in the event that they actually need to invoke in
the event of a disaster. So DR plans are very popular.
Another use case that’s very popular among our clients is short-term compute. We work with a
lot of customers who have massive mathematical calculations and they do a lot of number
crunching.
Data crunching
One customer that comes to mind is one that looks at the probability of natural disasters on
large structures, such as bridges, tunnels, nuclear power plants. They came to AT&T, looked at
our Synaptic Compute as a Service, and ultimately ran a very large number of VMs in a
workload. Because of the large amount of data crunching they had to do, they ran it for two
weeks straight on our platform. They finished the report. They were very pleased with the results,
and the convenience factor was there.
They didn’t have to stand up an environment temporarily for themselves and now they use us
anytime they sign a new client for those bursty type, short-term compute workloads.
Certainly test and development is one that I am seeing CIOs, directors of IT, and other functional
managers as one of the most highly adopted use cases, in that it’s lower risk. Over the years,
we've gone from, "Will I use the cloud?" to "What workloads are going to fit for me in the
cloud?"
For those that are earlier on in their journey, using AT&Ts Synaptic Compute as a Service for
their test and development environments certainly provides the performance, the global reach,
and also the economics of pay per use. And if a client has private networking solutions from
AT&T, they can fully integrate with our private networking solutions.
Finally, in the compute space, we're seeing a lot of customers start to hang virtual desktop
solutions off of their compute environment. In the past, when I would ask clients about virtual
desktop infrastructure (VDI), they'd say, "We're looking at it, but we're not sure. It hasn’t made
the budget list." All of a sudden, it’s becoming one of the most highly requested use cases from
customers, and AT&T has solutions to cover all those needs.
Gardner: I'm particularly interested in the spiky applications, where your workload spikes up,
but then there is no sense of keeping resources available for it when they're not in use. Do you
think that this will extend to some of the big data and analytics crunching that we've heard about
or is that hurdle of getting the data to the cloud still a major issue? And does your unique
position as a network service provider help pave the way for more of these big-data, spiky types
of uses?

10. Costello: I don’t think anyone is in a better position than AT&T to be able to help customers to
manage their massive amounts of data, given the fact that a lot of this data has to reside on very
strong networking solutions. The fact that we have 38 data centers around the world, a global
reach from a networking perspective, and all the foundational cloud capabilities makes a whole
lot of sense.
Speaking about this type of a bursty use case, we host some of the largest brand name retailers in
the world. When you think about it, a lot of these retailers are preparing for the holidays, and
their servers are going underutilized much of year. So how attractive is it to be able to look at
AT&T, as a service provider, to provide them robust SLAs and a platform that they only have to
pay for when they need to utilize it, versus sitting and going very underutilized much of the year?
We also host many online gaming customers. When you think about the gamers that are out
there, there is a big land rush when the buzz occurs right before the launch of a new game. We
work very proactively with those gaming customers to help them size their networking needs
well in advance of a launch. Also we'll monitor it in real time to ensure that those gamers have a
very positive experience when that launch does occur.
Gardner: I suppose one other area that’s top of mind for lots of folks is how to extend the
enterprise out to the mobile tier, to those mobile devices. Again, this seems to be an area where
having the network services expertise and reach comes to an advantage.
For an enterprise that wanted to extend more of their apps, perhaps the VDI experience, out to
their mobile devices, be they smartphones or tablets, what offerings do you have that might help
us grease the skid towards that kind of a value?
Mobility applications
Costello: AT&T has a very successful mobility applications business, and we have a couple of
examples of how customers use our cloud services in conjunction with making their mobile
applications more productive.
First and foremost, we have a set of experts and consultants who help customers to mobilize their
applications. So there might be internal customer proprietary applications, and we can really help
them move to an on-demand mobile environment.
Secondly, a couple of cloud examples of how customers will use our capabilities off the shelf.
One is our AT&T Synaptic Storage as a Service capability. We find that many customers are
looking for a secure place to collaborate on data sharing. They're looking to have a place to
access their data and store their data to enable a worker on the go scenario, or to enable a field
services applications or technicians.

11. Our AT&T Synaptic Storage as a Service capability gives the end-user that ability to store,
distribute, share, and retrieve that data on the go using any web-enabled device.
Another example is AT&T's Platform as a Service capability, a great foundational tool for users
to go in and use any one of our pre-built application and then instantly mobilize that application.
We have a customer who recently used this, because they had a customer meeting and they didn't
have a sophisticated way to get surveys out for their customers. They wanted to create a database
on the fly and get instantaneous feedback.
So they went into AT&T's Platform as a Service -- and this is a marketing person mind you, not a
technical user -- they entered the questions that they required of the customers. They sent the
quick questionnaire out to the end-users, five simple questions. The clients answered the
questions.
Ultimately, that customer had a very sophisticated database with all of that information that they
could use for market sensing on how to improve their products, number one. But number two, it
made sense to use it as a marketing tool to provide promotional information to those customers
in the future.
Gardner: Many of us have just returned from the VMworld Show in San Francisco. VMware
outlined some of their new initiatives and some of their concepts around the software-defined
datacenter. I am wondering when you were there, did you have anything in particular that
interested you about what might be then be able to bring about more AT&T or different
extensions of your cloud services?
Costello: I thought this year's VMworld Show was fantastic. I learned a lot. I don't have
anything in particular from the show to say that we're pursuing immediately. We had many
excellent meetings from the VMware team and were given previews of all of the latest
technology.
More generally, we're starting to see more customer demand for finished services. For AT&T it's
not about selling infrastructure services, it's about providing a differentiated experience and a
solution to business problems.
We're starting to see more and more demand from our clients who say, "I don't care what's under
the covers. Provide me with that finished services experience, more of a marketplace type of an
experience." That's going to be a big trend going forward.
Also you mentioned earlier about big data, and we see that as an important growth area for
AT&T as well.
Gardner: Very good. We've been talking about how global telecommunications giant AT&T has
been creating and delivering advanced cloud services for the customers, and we have seen how
they view the VMware-centric infrastructure approach to help provide virtual private clouds and
other computing capabilities as integrated services at scale.

12. So thanks to our guest, Chris Costello, Assistant Vice President of AT&T Cloud Services, really
appreciate your input.
Costello: Thank you.
Gardner: This is Dana Gardner, Principal Analyst at Interarbor Solutions. Thanks again to our
audience for listening, and do come back next time.
Listen to the podcast. Find it on iTunes. Sponsor: VMware
Transcript of a BriefingsDirect podcast on how telecom giant AT&T is leveraging its networking
and cloud expertise to provide advanced cloud services. Copyright Interarbor Solutions, LLC,
2005-2013. All rights reserved.
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