- Competition is heating up in India’s booming cloud market
- Airtel deepened its partnership with IBM to boost the Airtel Cloud platform
- The collaboration enables Airtel Cloud to rapidly expand from four to 10 availability zones
India’s cloud market is booming as global and domestic players move to increase their market share. Case in point: India’s second-largest service provider, Airtel, expanded its existing 20+ year relationship with IBM to expand its recently launched Airtel Cloud.
Airtel competes with hyperscalers like Google, Microsoft and Amazon Web Services (AWS), as well as home-grown players like Tata Communications, which launched Vayu Cloud, an umbrella AI-cloud offering earlier this year.
The growing adoption of AI services, coupled with the requirements of localized data storage, means that the demand for cloud services is surging in the country.
About that Airtel-IBM partnership
As part of its agreement, Airtel will be able to offer IBM’s services. The partnership combines Airtel Cloud's data residency with IBM's cloud solutions and software technologies for AI inference. Airtel Cloud customers will be able to deploy the IBM Power systems portfolio as-a-service, including the latest-generation IBM Power11 autonomous, AI-ready servers for mission-critical applications in regulated industries like banking, healthcare, government and others, according to the press release about the deal.
“The IBM announcement is focused on Airtel expanding its support for (and distributing) IBM’s Power Systems Portfolio in its cloud for specific vertical market requirements. It also allows Airtel to expand its cloud availability zones in India from four to ten, a big jump. This deal is a notable achievement for IBM, as it is not a major cloud services player anymore, but can bring some unique hybrid cloud strengths to bear for certain projects,” said Matt Walker, chief analyst at MTN Consulting.
“IBM’s quantum computing and RedHat unit are additional reasons for Airtel’s interest in partnering with IBM in the cloud,” adds Walker.
Airtel’s digital unit Xtelify launched Airtel Cloud, a “sovereign, telco-grade cloud platform” earlier this year. Designed to handle 140 crore (1.4 billion) transactions per minute for the telco’s own use in India, it is now being offered to enterprises in the country.
A long-time partnership
Airtel and IBM have been partners for over two decades now. The service provider outsourced the management of its entire IT operations to IBM in a 10-year deal in 2004. The deal was initially worth $750 million, but later the value expanded as Airtel’s subscriber and infrastructure grew. The two companies continued to work together in some form over the last two decades.
”This [historic relationship] has direct implications for Airtel’s enterprise business, which the company sees as a growth driver and which Airtel Cloud is a key component of,” says Matt Walker, Chief Analyst at MTN Consulting.
"Through our partnership with Bharti Airtel, clients across India can leverage IBM's innovative cloud offerings designed for workloads that address their strategic business priorities. Together, we will help clients drive true transformation in the era of AI,” said Rob Thomas, SVP and chief commercial officer at IBM.
“With the IBM partnership, we are adding substantial capabilities to our Cloud platform to address the unique needs of several industries that require migration from IBM Power systems and allow for AI readiness,” said Gopal Vittal, vice chairman and managing director at Bharti Airtel, in the release.
India’s public cloud market is estimated to have reached $14.43 billion in 2024 and is projected to touch $68 billion by 2032, with a Compound Annual Growth Rate (CAGR) of about 21.80%, according to IDC. The growth of AI and the digital transformation of enterprises is fueling this growth.
Fierce reached out to Airtel about the deal but the company was unable to comment due to a company quiet period and Diwali.