Savvis Expansion Spurs CenturyLink Growth

| About: CenturyLink, Inc. (CTL)

A CenturyLink (NYSE:CTL) company called Savvis recently announced that its Savvis Symphony Virtual Private Data Center (VPDC) cloud solutions will be available to Canadian customers. This will allow clients to experience improved "business agility through improved efficiency from their IT infrastructure".

With a company like Savvis under its belt, CenturyLink can be a serious player in that all-important technological market that we can see growing every day: cloud computing. Savvis is a leader in this domain. What makes Savvis particularly valuable is that there is a growing demand for its services across the world. The data center will also appeal to a variety of different customers as there are numerous different services and features provided by the system. Consumers will be able to personalize the system to suit their own needs.

At this point in time, the Canadian cloud market is very small in scope, at least as compared to those of other countries. This presents an opportunity for web hosting providers to sell cloud services to Canadian companies as well as the country's government organizations on premises.

This move means that CenturyLink, through Savvis, will have a far firmer foothold in the Canadian market. Its presence will be well established, which will keep the door open for any future advancement that may need to occur in the area.

In general, we can see that there is an increase in demand for cloud computing solutions. By extending Symphony VPDC into Canada, the company is essentially able to address both local and global demand for cloud services. This means that CenturyLink and Savvis stand to become a leader in the arena. Canada is not the only area where Savvis has made its mark with cloud computing technology. Recently, the company also made announcements about cloud expansions in a variety of other countries including Germany, Japan and Hong Kong. The company announced that it plans to extend its cloud services to new territories all over the world, so hopefully this expansion in Canada does not mark the end of its move towards making its presence more deeply felt. This is good to hear - the Asian markets are the ones that are expanding most rapidly, so an interest in this part of the world will probably mean good things for the stock in the future. As compared to a number of other competitors in the market, CenturyLink seems to have a lot more going for it.

AT&T (NYSE:T) has expressed interest in purchasing the 700 MHz Lower B Block spectrum that may soon be on offer from Verizon (NYSE:VZ). However, Verizon will only sell the specific spectrum if it can get approval to purchase a replacement spectrum from a collection of cable companies. Verizon says that 36 companies have stated that they are interested in purchasing the spectrum, although AT&T is one of the few to have made its interest known. To me this seems like a good move or AT&T as the spectrum that Verizon wishes to sell is a perfect match for one that it already has.

Alcatel-Lucent (ALU) is under pressure from investors at present. Stockholders are less than impressed with the company's poor performance of late. For a while now the company's managers have been promising an imminent turnaround, but we have yet to see evidence of this. Investors are starting to chomp at the bit as things do not seem to be getting any better. The company started its turnaround strategy four years ago, but we have yet to see the benefits from that strategy. Recently, the CEO pushed back the deadline for recovery and has left investors in the hanging wondering when the turnaround will begin.

Frontier Communications (NYSE:FTR) recently announced its plans to expand Internet connectivity and its telecommunications infrastructure in West Virginia, expressing the belief that this would improve the entire state. The company acquired property from Verizon in the state about two years ago and since then it has invested $310 million into improving the Internet status of West Virginia. The company believes that by turning West Virginia from "one of the least wired states in the nation to one of the most wired" it will be able to have a positive impact on the state's economy.

Verizon will soon start offering new shared data plans, a move that has stirred a lot of interest in a number of people. There is certainly a lot of talk online about the new plans. Although overall prices are higher, you may still be able to get a significant decrease in the costs that you pay if you own many data intensive devices. The shared plans essentially split data between multiple devices, allowing you to better make use of the data that you are provided with form the company. I feel that this may attract more consumers to Verizon and thereby improve the stock's chances.

A focus on cloud computing is what we need to see in tech stocks if they are to be successful. This is a good focus for the CenturyLink subsidiary to have. With a little more work and a more intensive focus on the cloud, CenturyLink will be able to keep its strong position in the technology market. In addition, I feel that things can only improve for the company from here on out. If Savvis continues to expand operations throughout the world, this will have a great impact on CenturyLink stock. It also seems at the moment that there are not a lot of companies that are making this global approach at the cloud question, which may also give CenturyLink a good lead. As long as the cloud hangs overhead, CenturyLink should see stable growth.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

About this article:

Author payment: $35 + $0.01/page view. Authors of PRO articles receive a minimum guaranteed payment of $150-500.
Tagged: , , , Telecom Services - Domestic,
Want to share your opinion on this article? Add a comment.
Disagree with this article? .
To report a factual error in this article, click here