UPDATED 06:50 EDT / JUNE 16 2015

NEWS

Deutsche Telekom teams up with Huawei to target Amazon in Europe

Germany’s Deutsche Telekom is looking to muscle in on Amazon turf in Europe, where it’s ramping up its cloud business by expanding its partnership with China’s Huawei Technologies Co. Ltd.

The telecoms firm said that by linking with Huawei it would be able to double its business cloud revenues to $2 billion by 2018, becoming Europe’s most dominant telco in the process.

Speaking at Huawei’s Innovation Day event in Munich, Ferri Abolhassan, Head of the IT Division at DT subsidiary T-Systems, said this wouldn’t be possible without the assistance of its Chinese friends. The alliance would help DT to match the pricing of its “global competitors”, Abolhassan said.

“At Deutsche Telekom, we want to grow by more than 20 per cent each year in the field of cloud platforms, and to become the leading provider for businesses in Europe,” he stated. He also noted that T-Systems’ cloud revenues had already increased by double-figure percentage points in the past year.

According to Abolhassan, DT is planning to “pit itself strongly against Google and Amazon in future”.

That will be a tall ordeal when one considers just how big Amazon Web Services is. The cloud leader recently reported revenues of $1.7 billion in Q1, with income of $265 million. That’s considerably more than where DT hopes to be in just three years time.

Nonetheless, DT believes it has an ace up its sleeves of sorts – namely, its cloud services for Europe are all provided from German-based data centers, which means they’re subject to that country’s strict data protection guidelines. For numerous European customers concerned about U.S. authorities ability to peek at their data at will, that could be a big selling point, the company believes.

“In cloud computing, data centre location brings the valuable advantage of security. Our customers and partners place their full trust in Deutsche Telekom in this regard,” Abolhassan said.

The partnership with Huawei will certainly help to reassure European customers there’s no way the NSA can pry at their data from DT’s German data centers, but at the same time, those customers might be worried about China’s ability to snoop – it wasn’t so long ago that Huawei was banned from selling networking kit to U.S. government agencies for precisely the same suspicions.

Still, it seems DT isn’t worried. “There must also be in Europe a force that is an answer to all the initiatives coming from the US”, Abolhassan proclaimed.

Photo Credit: Duda Arraes via Compfight cc

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