Should Cloud Providers Also Be Internet Providers?

July 1, 2011 Off By Hoofer
Grazed from ReadWriteWeb.  Author: Klint Finley.

When I got my first smartphone, the original black and white Danger Sidekick, the data plan cost me something like $40 a month for unlimited data plus something like 200 anytime minutes. These days an unlimited data plan will cost you more like $30 a month, not including voice minutes. But the original Sidekick couldn’t play music or movies. You couldn’t download additional apps (the app catalog came along in later models). All you could do was browse the Web with its scaled down browser, use AOL Instant Messenger and e-mail. I suppose it was easy to offer an "unlimited" data plan, when it was hard to actually download much…

But the days of unlimited data are going away. AT&T already dropped its unlimited plan for new users, and Verizon is about to do the same. We’ve written before about the mobile data bottleneck, which is only going to get worse as more smart phones and tablets get online.

In an article at Enterprise Efficiency Andrew Froehlich, makes the case that cloud providers should also become Internet providers. Specifically, he suggests Apple and Google get into the ISP business.

The problem I see with this idea:

1) ISPs increasingly are becoming cloud providers. Earlier this year Verizon bought infrastructure-as-a-service provider Terremark. Then Time Warner Cable bought NaviSite and CenturyLink bought Savvis. These telcos are interested in making money on both ends: selling customers both bandwidth and storage.

2) It’s not easy to become a telco, though Google is trying.

What do you think? Should cloud providers start offering Internet access?