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IBM extends cloud services with SoftLayer acquisition

No price disclosed, but SoftLayer's business estimated at $2bn

IBM is accelerating its push into cloud computing with the acquisition of SoftLayer Technologies for an undisclosed sum.

The Dallas-based company SoftLayer is reportedly the largest privately held cloud service in the world, with an estimated worth of around $2 billion according to reports from the Wall Street Journal.

Softlayer has 13 data centers in the US, Europe and Asia that will become the foundation for a new IBM Cloud Service division, which, along with IBM’s SmartCloud Franchise, will allow the company to begin to challenge Amazon’s dominance in providing cloud services.

This area of the industry has been one of IBM’s largest areas of growth. In 2011 the company projected that revenues from cloud services would generate $7 billion in revenue for the company by 2015, of which $3 billion is incremental growth.

Cloud services allow companies to store software and data so that online so it can be accessed from any Internet-connected device. Gartner estimated that in 2012 $109 billion was spent on cloud services, a 20 per cent increase from the year before.

The most widely used providers are Amazon Web Services and Windows Azure though many other companies, including AT&T and HP have a presence in the market.