OpenStack startup Mirantis is broadening its strategy beyond simply building OpenStack-based private clouds for customers, to offer private clouds on multiple underlays, emphasize services more, and de-emphasize selling software. As part of this strategic refocusing, 100 people have been laid off and 180 people have been reassigned, according to Mirantis CEO Alex Freedland.
“We need to focus not just on OpenStack but on the way it’s delivered and the way innovation continues to flow,” Freedland (above) explained in an interview earlier this week with the Daily Cloud. “We do this in partnership with the customer’s IT organization. The piece we are adding is lifecycle management of how we deliver OpenStack and this is through our recent acquisition of TCP Cloud, who are specialists in continuous delivery. Also, Kubernetes is a natural container delivery lifecycle tool, not as a replacement for OpenStack but as a generic OpenStack delivery vehicle.” Simply translated, that mouthful means more cloud platforms and more focus on not just building them but managing them for customers.
On the human resources side, Freedland told us that “slightly over” 100 people were laid off and another 180 people were reassigned, mostly to projects associated with lifecycle management and Kubernetes. “This was a talent refresh,” he said. With 750 employees, and business growing at a 70% rate, Mirantis remains the leading OpenStack-focused startup.
Mirantis was founded in 2011 amidst widespread industry excitement that OpenStack would become the standard management layer for private clouds, a cheaper, open source alternative to VMware (VMW). However it soon became clear that it was devilishly complicated to build a working OpenStack cloud since a number of ever-changing open source components always need to be customized and configured to work together. Customers who have built and used OpenStack clouds have tended to be either huge service providers like AT&T or very large enterprises like Walmart willing to commit dozens of engineers to the project for many months. According to Freedland and others, many of the complexities of building an OpenStack cloud have now been tamed, but operating and modifying an OpenStack cloud remains complex. “OpenStack is hard to operate and the problem is not that it is bad, the problem is that you need modern devops tools,” Freedland says. He argues that companies like PayPal have proven it can be done and Mirantis is now building those tools in a generic form that will make it easy to operate, and modify, an OpenStack cloud, and eventually a Kubernetes cloud.
Window
Turbonomic is a Boston-based startup providing a software solution that improves the performance of clouds or virtualized environments of all the major cloud providers. Turbonomic’s customers include many of the largest banks, insurance companies, law firms, manufacturing companies, and government agencies in the U.S., so it has a broad view of how enterprises are building private clouds (and using the public cloud). Turbonomic CTO Charles Crouchman thinks OpenStack’s future is not bright. “There’s no question OpenStack has not fulfilled the hopes many of us had for it to become the de facto standard for on-premise private clouds, and the window is now closing on it,” Crouchman says. He says newer technologies are likely to overtake OpenStack before the private cloud market truly lifts off.
The feeling that OpenStack is losing momentum was increased by Hewlett-Packard Enterprise’s (NYSE:HPE) recent decision to exit the business of OpenStack development. Here too, there was a rumor that about 100 people were laid off, with more to follow. HPE confirmed the layoffs (without citing numbers) in an email to the Daily Cloud, and added that it supports OpenStack, but tellingly omitted to say it would continue to invest in product development of OpenStack: “HPE will continue to focus on market adoption with highly-skilled field services, 24x7 support and an array of integrated systems tuned to a variety of popular use cases. Furthermore, we are finalizing our partnership (announced in September) with MicroFocus as HPE’s strategic technology partner for the OpenStack and Cloud Foundry projects.”
We touched base with two other OpenStack vendors, both of whom assured us they were seeing healthy growth. London-based open source software vendor Canonical told us their OpenStack business is now in the tens of millions of dollars and growing at a 70% annual rate. Canonical CEO Mark Shuttleworth cited British broadcaster Sky TV (SKY.L), a huge company with $12 billion in revenue and 21 million customers, as an example of how Canonical has simplified the operation of OpenStack for customers: “Sky has four engineers supporting one quarter of their entire data center running on OpenStack,” Shuttleworth said.
Another startup, Silicon Valley-based Platform9, also offers an OpenStack solution, in this case as an off-premise SaaS service that supports an on-premise private cloud for around 50 customers today. By building a standardized SaaS version of OpenStack, Platform9 simplifies the process for customers. “80% of OpenStack deployments either fail or take too long,” said Platform9 CEO Sirish Raghuram. “99% of our deployments succeed.”
However all the OpenStack vendors concede that deployment and operational difficulties do slow down adoption. As Shuttleworth puts it: “Complexity is going up faster than the existing tooling can accommodate.” He adds: “It may be fine when a customer says `I want 20 people to help me build a cloud, but when he finds that he also needs 20 people to help him operate it, that just blows the economics.”
Mirantis’s Freedland points out that this complexity is a feature of other cloud management systems besides OpenStack, and container technologies too. “Kubernetes has the same set of problems. So it’s about taking that complexity and empowering operations so you can create an Amazon Web Services-like experience,” he says. Freedland adds that Mirantis is seeing more customer interest than ever, winning more business with a large European telco partly because HPE has withdrawn from the OpenStack project. “We’ve never had so many marquee customers come to us at one time as we do today,” he said. “Figuring out how to handle all these customers with just 750 people is a challenge.”
Turbonomic’s Crouchman praises Mirantis’s flexibility: “If Mirantis was still doing OpenStack and nothing but OpenStack, they’d be in trouble. They’re pivoting and adjusting their strategy as the world changes and that’s appropriate.”
