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Time Warner Cable reaches for the cloud

Wed, 02/02/2011 - 7:35am
Mike Robuck

Time Warner Cable announced late yesterday afternoon that it had entered into an agreement to buy cloud vendor NaviSite for $230 million.

The deal gives Time Warner Cable Business Class a significant presence in the managed services sector, which includes NaviSite's enterprise-class hosting, managed application, messaging and cloud services. Time Warner Cable Business Class, a division of Time Warner Cable, will gain more than 1,200 NaviSite customers once the deal closes in the second quarter.

Cable operators, including Cox Business and Comcast, are reaping incremental revenues by, among other managed services, storing businesses data online.

"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. We expect to build upon NaviSite's successful enterprise-class offerings and their operational capabilities, infrastructure and expertise to more rapidly create a robust managed services offering for small-and medium-size businesses. 

"This transaction is consistent with our capital allocation strategy – selectively investing in our business to accelerate growth while continuing to return capital to shareholders."

Time Warner Cable said it planned to continue the service of NaviSite's enterprise customers and to use NaviSite's operational expertise and enterprise-class infrastructure to meet the growing demand for managed services offerings from Time Warner Cable's existing and future small- and medium-size business customers.

Andover, Mass.-based NaviSite employs approximately 570 people worldwide. It operates 10 data centers in the United States and the United Kingdom, including two SAS 70 Type II certified data centers and network operations centers in Gurgaon, India, and Andover.

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