IBM is buying an international cloud-computing company in order to offer customers more options for remote software delivery. The Associated Press reports that IBM’s acquisition, SoftLayer Technologies of Dallas, has 13 data centers in the United States, Europe and Asia, and that the deal will close later this year. Financial terms of the deal were not disclosed, but the Wall Street Journal and The New York Times report that IBM is paying around $2 billion for SoftLayer. The Wall Street Journal explains the advantages of cloud computing for businesses:
Cloud computing is growing rapidly as small and large companies see it as a cheaper and more flexible approach to using technology.
In cloud computing, companies rent computing power and technology instead of buying it upfront and managing it themselves at greater initial expense.
Cloud computing is one of IBM’s major growth areas. In 2011, IBM projected that cloud services would generate $7 billion in revenue for the company by 2015, of which $3 billion is incremental growth.
According to The New York Times, IBM has spent $4.5 billion on a number of other acquisitions since 2007 to broaden its cloud services, with an emphasis on software for business management. IBM is competing with other major technology companies, notably Amazon, that also offer cloud computing.
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