Please ensure Javascript is enabled for purposes of website accessibility

CenturyLink Has Its Head in the Clouds

By Steve Symington - Mar 14, 2017 at 9:00AM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The telecommunications leader could win the hearts of more enterprise customers with its new cloud-based orchestration platform.

If there's one thing that's certain in the world of technology, it's change. And so it goes for telecommunications giant CenturyLink (LUMN -1.05%), which continues to foster its strategic revenue streams to offset declines in its legacy businesses.

Of course, CenturyLink also has its hands full ensuring its impending acquisition of Level 3 Communications (LVLT) closes as planned later this year. But in the meantime, one intriguing strategic growth opportunity for CenturyLink lies with its budding status as an IT services and enterprise cloud solutions provider.

To that end, CenturyLink recently launched its new Cloud Application Manager, a "cloud-agnostic management platform" designed to simplify enterprise customers' deployment of workloads, managed services, and third-party cloud resources across hybrid hosting environments.

CenturyLink Cloud Application Manager supports multiple clouds through a single interface.

CenturyLink's Cloud Application manager helps automate and manage multiple clouds from a single interface. Image source: CenturyLink 

 

One cloud platform to rule them all...

According to David Shacochis, CenturyLink VP of Hybrid IT product management:

Many of our customers and partners struggle with the business challenge of determining the best execution venue for their business applications. We designed Cloud Application Manager to give our customers a wide variety of infrastructure options across diverse public and private cloud environments. Cloud Application Manager helps companies avoid vendor lock-in, automate application deployments, scale workloads across disparate hosting environments, and optimize their costs over time.

Better yet, CenturyLink is offering customers the flexibility to use Cloud Application Manager through either a self-service model with their own IT staff, or as one actively managed by CenturyLink's team. Cloud Application Manager also comes in either a cloud-based software-as-a-service (SaaS) version, or in a "data center version" with a virtual appliance that runs on-premises in the customer's data center.

If all of this sounds familiar, it's likely because Cloud Application Manager leveraged CenturyLink's $20 million acquisition of multi-cloud platform specialist ElasticBox this past June. At the time, CenturyLink CTO Aamir Hussain noted their acquiree's compelling platform supported over a dozen different cloud providers, including Amazon Web Services, IBM's SoftLayer, Microsoft Azure, and VMware, as well as Google Compute Engine, OpenStack, and of course CenturyLink Cloud.

As Hussain further elaborated, ElasticBox's platform freed "businesses to focus on issues that are central to their organization rather than spending time and resources managing multiple clouds."

Better days ahead?

So what does this mean for CenturyLink's business? For perspective, during CenturyLink's quarterly conference call last month, management explained that lower-than-expected managed hosting and IT services revenue was one culprit for the company arriving near the low end of its fourth-quarter 2016 guidance.

To be fair, the bulk of the blame still sat with slower growth in both CenturyLink's consumer broadband and consumer video revenue. But those obviously troublesome segments come with their own challenges. And any relative success CenturyLink can garner through current and forthcoming products like Cloud Application Manager could serve to not only drive incremental revenue themselves, but also afford the company a perfect segue into CenturyLink's other complementary IT consulting and managed services solutions.

Prior to Cloud Application Manager's formal launch, for example, CenturyLink had already launched other new and expanded solutions in recent months spanning managed security services, Managed SAP and HANA, enterprise cloud and managed big data, and Big Data-as-a-Service products. CenturyLink CEO Glen Post insisted they "have all been very well received by industry analysts and are beginning to show good traction with our customers."

In the end, then, I think investors would do well to keep a close eye on any similar signs of early traction for CenturyLink's Cloud Application Manager when the company next reports quarterly results in early May. If it proves successful, it could mean better days ahead for patient CenturyLink shareholders.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

Lumen Technologies Stock Quote
Lumen Technologies
LUMN
$11.25 (-1.05%) $0.12
Microsoft Corporation Stock Quote
Microsoft Corporation
MSFT
$256.48 (-3.17%) $-8.41
Amazon.com, Inc. Stock Quote
Amazon.com, Inc.
AMZN
$107.40 (-5.14%) $-5.82
International Business Machines Corporation Stock Quote
International Business Machines Corporation
IBM
$141.86 (-0.66%) $0.94
VMware, Inc. Stock Quote
VMware, Inc.
VMW
$116.25 (-1.20%) $-1.41
Level 3 Communications, Inc. Stock Quote
Level 3 Communications, Inc.
LVLT

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning analyst team.

Stock Advisor Returns
332%
 
S&P 500 Returns
115%

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 06/28/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.