Telecom Spending Spree: Time Warner Cable Snatches Up Enterprise Cloud Hosting and Management Company NaviSite

Hot on the heels of Verizon‘s acquisition of Terremark, Time Warner Cable is acquiring NaviSite, an enterprise cloud hosting and management company. Time Warner Cable will pay $5.50 a share, or approximately $230 million.

Meanwhile, speculation is rampant that Savvis will be acquired, though its CEO James Ousley says things are business as usual for the company.

NaviSite was founded in 1997. At the core of its service is NaviCloud, its infrastructure-as-a-service offering. According to Gartner, “NaviSite can offer its managed application services on NaviCloud, reducing its provisioning times for complex applications from several weeks to as little as an hour.”

Last week when Verizon announced its acquisition of Terremark we predicted that telcos would go on a spending spree. Consolidation is a watch word this year as many large companies look to get into cloud computing. We quoted EMC‘s Vice President of Global Marketing and CTO Chuck Hollis’s saying “If you believe in the secular trend that — over time — more IT will be delivered as a service vs. consumed in a traditional fashion, you quickly realize that telcos can have a compelling position.”

That does seem to the reasoning behind Time Warner’s acquisition today. From the announcement:

“Our commercial services business is a key growth driver for the company and one in which we continue to see great opportunity,” said Glenn Britt, Chairman and CEO of Time Warner Cable. “NaviSite provides us with a successful managed services business and a new, innovative managed cloud platform representing significant new growth opportunities.

Savvis and Terremark were positioned as a “Leaders” in Gartner’s Magic Quadrant for Cloud Infrastructure as a Service and Web Hosting. NaviSite was positioned in the “Challengers” quadrant, but right on the edge of being a leader.

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