Why Billion Dollar Red Hat and OpenStack Need to Dance

March 1 2012 | By | in Open Source

On February 29, 2012, Red Hat’s fiscal year came to a close and they are expected to cross an important milestone; becoming the first billion dollar commercial open source software company.  Whether or not you believe they are the first open source software company to cross this mythical threshold is inconsequential, the fact is Red Hat has done it.  With all my sincerest respect and admiration, I tip my “red hat” to this historical accomplishment.

With all due respect to other Linux distributions such as Canonical (Ubuntu) and SUSE, Red Hat is the de facto standard for Enterprise Linux.  They have a reputation for building a quality product, have a stable of certified applications from leading ISVs, maintain a “Cisco-like” army of certified professionals, and provide long term support for their products.  Unlike the early years of their business, Red Hat’s biggest threat does not come from a new operating system challenger ala Microsoft; it comes from virtualization vendors with all eyes on VMware, Microsoft, Citrix, and Oracle.

The good news is that Red Hat foresaw this threat and purchased Qumranet in 2008, which created kernel-based virtual machine or KVM.  The bad news is while VMware grew to a virtualization powerhouse, it took Red Hat until January 2012 to release a real challenger within Red Hat Enterprise Virtualization 3.0 (RHEV3). With this release, the next chapter in Red Hat’s history is unfolding within the Cloud era.

Meanwhile, OpenStack is nothing short of an amazing story of the power of open source and of community.  In July 2010, Rackspace and NASA jointly launched OpenStack and less than 2 years later OpenStack has the backing of over 150 companies with names like Dell, AT&T, HP, Citrix, and more.  Additionally, you’ll find the likes of Canonical and SUSE, but Red Hat is noticeably absent.  However, is Red Hat really that far away?

All one has to do is open OpenStack’s Administrator Manual and you will find instructions on “Installing OpenStack Compute on Red Hat Enterprise Linux 6”.  Also, looking closely at the list of contributing companies you will find Gluster (one of my favorites), a project acquired by Red Hat on the list.

In the battle for virtualization supremacy, OpenStack is a vital weapon against the competition.  Sure, Red Hat has Aeolus and Deltacloud, but what would the world look like with a RHEO (Red Hat Enterprise OpenStack) edition?   Wouldn’t such a release accelerate OpenStack’s rise in the Enterprise while opening up a new revenue source for Red Hat?

Before any of this can happen, Red Hat and OpenStack must dance.  Sure, there are reports that early on Red Hat was invited by Rackspace to join OpenStack but they refused due to its governance model.  However, things have changed as Rackspace has transitioned management of OpenStack to an independent OpenStack Foundation with a defined mission and structure.  Can Red Hat and OpenStack unite under this new model?

Perhaps the final piece of this puzzle will end with a Red Hat acquisition within the OpenStack ecosystem.  Without naming names, there are at least 2 attractive take-over targets that would give Red Hat the development expertise and OpenStack credibility to be a force.

As John Lennon famously wrote and performed in “Imagine”; “You may say I’m a dreamer, but I’m not the only one, I hope some day you’ll join us, And the world will be as one.”

Red Hat and OpenStack, let’s dance!

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  • http://www.facebook.com/profile.php?id=1302986679 Dewan Shamsul Alam Russel

    You are not alone. I’ve been using Redhat products for a long time. To be honest, it hurts me when I see Redhat not doing much about Openstack. I’m sure they are going to change their position and also support Openstack in their Enterprise linux and Fedora distributions.

    • http://twitter.com/PlatenReport Floyd Strimling

      I certainly hope so as Red Hat could commercialize OpenStack within their software portfolio.  Hopefully, there is behind-the-scenes that are taking place as it would be a mutually beneficial relationship! 

    • http://engbblog.wordpress.com/ Juanjo

       Fedora supports OpenStack since Fedora 16:


    • http://wartadigital.com/ WartaDigital

      i also have some issue with you, its about openstack

  • Anthony

    With music playing while trying to wrap my head around everything in this post, I’m left wondering if Red Hat is playing a song by Whitney Houston, as it relates to this topic
    . . .”I wanna dance with somebody”  With special attention to these lyrics. . .

    Oh! I wanna dance with somebody.

    I wanna feel the heat with somebody.

    Yeah! I wanna dance with somebody,

    With somebody who loves me.

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  • Mathew

    I imagine that Rackspace put them under pressure to support OpenStack (as Red Hat is RACK’s only supported Linux). Also because Red Hat’s own “CloudForms” effort has sunk without trace.

  • Anonymous

    Don’t forget that Red Hat has positioned themselves quite well in the PaaS domain with OpenShift.

  • http://engbblog.wordpress.com/ Juanjo

    Deltacloud is an Apache project, so I wouldn’t say “Red Hat has Deltacloud”.


  • http://putt1ck.blogspot.com/ Chris Puttick

    You missed part of a sentence: “Red Hat is the de facto standard for Enterprise Linux” should end “in the US”. Not in Europe, it’s just one of several.

    Though that doesn’t stop them needing to support OpenStack ni RHEL :)

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  • Tweeks

    Oh.. in the open source community,everyone has a dance ticket. But if want all the latest buzz, you hafta hang with the band and sound crew back stage. ;)


  • Angus

    git clone https://github.com/openstack/nova.git
    cd novagit log –since=”6 months ago” –pretty=format:”%ae” | grep -v “review.openstack.org” | cut -d@ -f2 | sort -n | uniq -c | sort -n | tail -10     24 canonical.com
         25 jk0.org
         32 nicira.com
         34 openstack.org
         35 citrix.com
         44 cloudscaling.com
         46 codestud.com
        132 redhat.com   < —
        285 gmail.com
        343 rackspace.com

  • http://myindigolives.wordpress.com/ Ellie K

    I’m not being intentionally contentious, just trying to make sure I understand the significance here. 

    “Billion dollar” refers to what, exactly? Red Hat annual revenue (for fiscal year 2011, as of close on 29 Feb 2012)? Or Red Hat’s profit for the year? Or something else? Could you clarify, please? There was no link to an annual report or other document. Thank you!

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