Telefonica to migrate systems onto cloud in deal with Oracle

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The logo of Spanish Telecom company Telefonica is seen at its headquarters in Madrid, Spain, May 12, 2021. REUTERS/Sergio Perez/File Photo

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MADRID, Sept 27 (Reuters) - Spain's Telefonica (TEF.MC) signed a multi-year deal with cloud-service provider Oracle (ORCL.N) to migrate most of its database systems to the cloud, the firms said on Monday, in preparation for the use of 5G and the Internet of Things (IoT).

The telecoms operator, which already uses Oracle data systems, will transfer them to a fully cloud-based private platform supporting its internal and commercial operations, including business intelligence services and billing, revenue and customer management products.

The new platform will be operated by Oracle in Telefonica's own datacentres to keep costs down, ensure security and comply with European data laws, the joint statement said.

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"It's a four-year deal, whose final aim is to migrate all systems onto [Oracle's] public cloud," one source with knowledge of the deal said. "The private cloud is an intermediate step between having physical machines to connect to and suddenly - nothing."

"We need to consolidate and simplify our technological infrastructure... to build a robust and scalable cloud platform in our own data centres... to satisfy the changing needs of our business," Telefonica's Tech and IT Transformation director Fidel Jesus Fernandez said.

The beleaguered operator - squeezed in recent years by a competitive, increasingly low-cost Spanish market and high costs as it rehauls its physical and digital infrastructure - is betting on the acceleration of digitalisation amid the pandemic.

Cloud computing has surged as businesses worldwide seek to migrate their systems online, a boon for providers like Amazon, IBM and Microsoft - but also drawing scrutiny for the potential regulatory and cybersecurity risks which fully cloud-based operations entail. read more

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Reporting by Clara-Laeila Laudette; Editing by Nathan Allen, Louise Heavens and David Evans

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