Red Hat OpenStack, Linux, Virtualization: Cloud Triple Play?

OpenStack, the open source cloud platform, has hundreds of backers. But like Linux, multiple OpenStack distributions may emerge on the market. That could trigger customer confusion and indecision. Enter Red Hat (NYSE:RHT), the leading provider of corporate Linux solutions. The VAR Guy is betting Red Hat will gradually repeat that success with OpenStack. Here’s why.
First, some background: OpenStack is designed for both public and private clouds. In theory, customers can more easily move workloads between their private systems and third-party clouds if all of those services are built atop OpenStack. But for OpenStack to thrive, it needs a critical mass of developers, suppliers, service providers, channel partners and customers who trust the solutions in the market. Let’s take a closer look at each area:
1. OpenStack Developers: This market seems to be thriving and growing fast. The recent OpenStack Summit 2013 in Portland, Oregon, attracted nearly 3,000 people — most of whom were software developers.
2. Suppliers: Here again, numerous companies want to offer OpenStack distributions. That’s a blessing and a burden, since too many choices can overwhelm customers.
3. Service Providers: It’s still very early but the OpenStack service provider market is promising. Several public clouds — including Rackspace, IBM and Hewlett-Packard — leverage OpenStack. Dell recently abandoned its own public cloud plans, which had included OpenStack.
4. Channel Partners: This is a weak area for OpenStack. The industry needs more trained OpenStack pros. Companies like Mirantis are leading the way here. But much more needs to be done.
5. Customers: BestBuy, Bloomberg, Comcast and Hubspot are using OpenStack. But it’s still early in the OpenStack customer deployment cycle.
Red Hat’s Opportunity
Compared to rival OpenStack advocates, Red Hat was somewhat late to this party. But don’t forget: The OpenStack party is really just getting started. Red Hat in April 2013 set up an OpenStack Partner Network to get going. A Red Hat OpenStack Distribution also is under development.
Why does The VAR Guy care? Simple: Red Hat is the one large open source company that has a strong track record with:

1. Developers: From giants like SAP to start-ups, developers write applications for Red Hat Enterprise Linux.
2. Suppliers: Yes, these can include rival OpenStack suppliers. But what about PC server makers? Here, Red Hat has strong relationships.
3. Service Providers: From telecom companies to cloud services providers, many of them offer Red Hat in their data centers.
4. Channel Partners: Partners like VARs influence roughly 60 percent of Red Hat’s sales.
5. Customers: Check any CIO survey, and you’ll find Red Hat at or near the top of trusted supplier lists.

Red Hat has an opportunity — a big opportunity — to extend that trust from Linux to Red Hat Enterprise Virtualization (RHEV) and OpenStack. Plus, you can imagine Red Hat Storage running in those cloud data centers, too.
If OpenStack succeeds on public and private clouds, The VAR Guy suspects, Red Hat will have a hand in that success.