Cloud Computing, Software-as-a-Service (SaaS), Marketing strategies

The recent announcement by Rackspace and their partners announcing the OpenStack, Open Source Cloud platform got me thinking. While I am still a skeptic, when it comes to the technology industry coming together and defining a common standard that all the vendors stood behind (as I wrote in my previous post), there are still ways to make a true open source cloud platform, a reality. When I say true open source cloud platform, I am not talking about the Infrastructure-only-service that Eucalyptus has come up with, but one with Infrastructure and Platform all integrated. That is were the enterprises will see true value.

Red Hat is probably the only company on earth that has really figured out a way to make money based on a open source model. Over the years, they have assembled a fantastic comprehensive stack of technologies that can compete with most of the proprietary technology vendors out there. Starting with the most widely used Red Hat Linux distribution with Virtualization support to a robust JBoss Application Server and Middleware and dare I say, the best java application platform with JBoss RichFaces, Seam, Hibernate ORM, Rules Engine, SOA, Portal among others, all integrated. People who have done extensive product development will agree with me that Seam is one of best technologies out there when it comes to orchestrating/wiring  application lifecycle across different tiers. It addresses some of the very complexities in Java development that other technologies like Spring don’t. It has just gotten even better with the recent releases incorporating support for scaffolding, Contexts & Dependency Injection (CDI).

So where am I going with this?

As the Infrastructure-as-a-Services (IaaS) and Platform-as-a-Service (PaaS) converge (and converge they will) and given that Rackspace has ventured into a Open Source journey, I think a quick marriage of Red Hat and Rackspace would make a lot of sense for both.

Here are some reasons

1. RedHat has been absentee voter, at best, in the whole cloud computing noise spectrum until now. It would get a tremendously well established cloud vendor who has, 80K and growing, customers across its Managed and Cloud Hosting offerings. Lot of great brand names, I might add.
2. Rackspace in one fell swoop can now become a complete cloud vendor with a great open source Platform-as-a-Service to add to its growing cloud business. Red Hat with all the great technologies can bring a great Java based platform to the mix.
3. With VMWare slowly but surely morphing into a Platform-as-a-Service vendor on the back of their SpringSource acquisition, Red Hat can counter the “SpringSource is the best java platform for cloud” rhetoric with bring their platform to the big stage.
4. Rackspace can now make a convincing argument against Amazon, that will remain a pure-play infrastructure vendor. A business that is going to be a low margin commodity business.
5. Customers of Rackspace and Red Hat will find it a compelling solution to implement a Private/Hybrid Cloud infrastructure with a complete integrated cloud solution. (And one throat to choke).
6. The combined entity with $1.5B in revenues will a viable option and can now compete better in the new cloud landscape and not get lost in the shuffle. The big guys will eventually get it together just in time the confusion over the private/public cloud computing etc, become clear.

Disclaimer: Given that both companies are public I will put my disclaimer out there. This is just a figment of my imagination on what might make sense and I have not had any discussions with company executives of either companies prior to writing this post.

About Subraya Mallya

Subraya Mallya is a Technology Executive with extensive experience is conceiving, building software products. He advises companies with their business and technology strategies around SaaS, Cloud Computing, Enterprise Software and Marketing. Connect with me on Google+, Twitter - @subrayamallya

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