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IBM's Latest Cloud Data Center Up in Sao Paulo

International Business Machines Corporation 's IBM subsidiary SoftLayer has opened its third cloud services support data center in Latin America. The latest facility is located in Jundiai, São Paulo and is the company's second such facility in Brazil.

As per Frost and Sullivan, Brazil's cloud computing market, which was worth $474.8 million in 2014, will more than double in 2017 to $1.11 billion. Further, as per Infiniti Research report last year, Latin America will register 28% growth in the cloud computing market by 2018.

To make the most of these opportunities, IBM is rapidly expanding in the region. The other two facilities in the region are located in Hortolândia, São Paulo and Queretaro, México. Globally, IBM has 41 cloud data centers located across Americas, Asia, Australia and Europe.

The Jundiai facility boasts of 9,000 servers and a 2.8 megawatts power rating. Like all other SoftLayer facilities, this facility will also provide the entire range of SoftLayer infrastructure services that include bare metal and virtual servers, storage, networking and security services. It will also host OpenStack-based solutions including from Blue Box, thereby helping to expand the reach of the OpenStack environment.

IBM acquired SoftLayer for nearly $2 billion in 2013 and since then has been rapidly expanding its cloud data center footprint worldwide. In 2014, it injected $1.2 billion as an additional investment for global expansion strategy.

Data centers form the backbone of IBM's business and the company's continuing investment reflects its commitment on developing the technology. Cloud computing, being one of the pillars of IBM's growth plan, is expected to contribute revenues of $7 billion by the end of 2015. Apart from cloud, other long-term growth drivers include Big Data & business analytics (worldwide data spending expected to be $266 billion, revenues are likely to grow at 6% CAGR through 2017), mobile ($103 billion addressable market), security ($74 billion market opportunity) and social business ($89 billion addressable market).

At present, IBM carries a Zacks Rank #4 (Sell). Better-ranked stocks in the same space include Top Image Systems Ltd. TISA , Mentor Graphics Corp. MENT and FARO Technologies Inc. FARO . Top Image Systems sports a Zacks Rank #1 (Strong Buy) while the other two carry a Zacks Rank #2 (Buy).

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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