The round was led by Kleiner Perkins Caufield & Byers with participation from original investors Lightspeed Venture Partners and individual investors including Mark Leslie, co-founder  of Veritas; John Thompson, former CEO of Symantec and Lane Bess, former CEO of Palo Alto Networks. It brings total funding to about $27 million.

The company plans to use the cash to build out its enterprise support, sales and marketing staff and to add capabilities as the software heads for general availability. That should happen in about two months, company CEO Poojan Kumar said in an interview. There are about 30 employees now, with the goal to add 70 to 80 more in the next 9 to 12 months, he said.

“Enterprise software requires staffing and expertise,” he said. He should know — Kumar led Exadata development for Oracle and then headed up data products for VMware. His co-founder Satyam Vaghani was principal engineer at VMware, where he worked on the vSphere kernel and the clustered file system.

PernixData says its software-only approach makes a disruptive technology a non-disruptive install that will run with a company’s existing server and storage hardware, take all the server flash available and virtualize it into a shareable pool. The company’s goal is to become “the VMware of server-side flash.”

As more servers ship with on-board flash, there’s a desire to make the most of that resource — especially for tier 1 applications like database and ERP applications that have proven difficult to virtualize.

San Jose-based PernixData is early to this battle but it won’t be alone for long. It’s safe to say that legacy storage  and server players — ranging from EMC and NetApp to Hewlett-Packard and Dell, as well as flash storage players like Fusion-io and Violin Systems — are scrambling for traction here.

PernixData is betting that its product — now in beta at 50 companies — will beat them to market by a good two years and build from there.

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“Last year was an interesting one, but in the last six months since, it’s all been positive news,” Gillai said in an interview on Wednesday at the OpenStack Summit.

Saar Gillai, Hewlett-Packard senior VP of converged cloud

During that timeframe HP brought its public cloud online  and  the compute, block store and object store subsystems are all broadly available. This week, it announced new “cloud bursting” capabilities for HP CloudSystem and that it had integrated its 3Par fibre-channel storage with OpenStack.

As for actual customer adoption of that HP public cloud? The company will only put the number at “thousands.”  And, Gillai reaffirmed that the company will make OpenStack available on all its major platforms, which in theory would include its glitzy new Project Moonshot servers. OpenStack is HP’s operating system for cloud, is the message.

But HP’s version of OpenStack will be  “hardened for the enterprise” vision and backed by enterprise-class SLAs, a stance that echoes what Zorawar Biri Singh, HP’s last cloud chief, told GigaOM a few months ago.

Here’s the thing: despite HP’s dramatic ups and downs of the past two years, it has lots of long-standing enterprise accounts that really would prefer not to defect to another vendor at this stage. “Our customers want us to succeed,” Gillai maintained. And many of these companies have barely tested cloud deployments.

The Amazon Web Services question

Many of those same customers are no doubt using Amazon Web Services for some storage or running non-mission critical workloads, but Gillai said AWS has a long way to go to become a true enterprise technology provider.

“Enterprise customers require business continuity assurances, they want someone to call and interact with,” he said. “Sure, AWS  is going after the enterprise, but it’s not that simple. You need feet on the street and you need account management. There’s a reason it takes companies time to build all that. You need a brand and you need trust.”

And, he said, echoing a now familiar theme, once big companies get a true picture of how much it costs to run some loads in AWS, they may find it cheaper to bring them into their own data centers or use a private cloud deployment instead. That’s where AWS may find some tough going, despite its moves to build bridges between AWS and private clouds.

Given AWS’s momentum, and the full court press it’s made on enterprise sales, this may be wishful thinking but, as many GigaOM commenters have pointed out, the percentage of total IT spend going to cloud now is pretty damn small. These are early days.

OpenStack consolidation to come

Unlike other OpenStackers at the show, Gillai expects there to be a shakeout of OpenStack vendors over time. “If all you’re doing is [an OpenStack] distribution, that’s not a business. I can build a distro right now for a one-server system, it’s a lot harder when you’re dealing with networked systems,” he said.

This is one big reason OpenStack will not follow the Linux model, he said: “The question is, how do you make money?  Linux is all about your compute system with some drivers — it’s an operating system. OpenStack is a plug-in architecture with myriad plug-ins and that can take you from one node to a million. To certify and install it can be miles more complicated than with Linux, so you need another business model.”

Companies that run public clouds — like, say HP — will be the experts with lots of insight, he said. “I would be wary of getting OpenStack distribution from someone who doesn’t run it on a huge cloud.”

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If you’ve taken part in CSA (community-assisted agriculture) program you know you get a bin of in-season fruits and veggies every other week or so — hopefully from a local farm. In that bin will be a few tomatoes, radishes, whatever and a ton of kale, which grows easily and big and is forgiving of bad weather. It’s prolific and it’s cheap. Then you find dishes and recipes to use that kale.

And this is where the fun begins: Kale, it turns out, can be used in everything. In chicken soup, in salads. It can be coated with sesame oil and roasted to make kale chips (my favorite). It can be sliced and diced in myriad ways. It can be boiled, fried (or sauteed, if you’re a fancypants) and baked. And it’s good for you.

Proponents would like to say the same about OpenStack.

OpenStack — in cable, in marketing, on a stick

Look at the various packages and delivery modes coming online: Red Hat this week announced the rollout of its RDO OpenStack distribution, “a freely available, community-supported distribution of OpenStack that runs on Red Hat Enterprise Linux, Fedora and their derivatives.” Piston Cloud (see disclosure) offers what InformationWeek called OpenStack on a stick, the software packed on a memory stick for easy deployment. Nebula just brought out its OpenStack-in-a-box controller for linking legacy applications into the OpenStack arena. HP cloud guru Saar Gillai talked up his company’s “hardened” OpenStack for enterprise use. Cloudscaling offers an OpenStack cloud that will burst into Amazon or Google public clouds as needed.

More to the point is that end-user organizations — not just the usual tech vendor suspects —  showed off some ways they actually use OpenStack. These included a new Comcast online interactive cable TV guide that helps users quickly navigate their hundreds of channels to find the sporting event they want to see and bring it up on screen for a quick score check. There’s also Hubspot’s use of OpenStack to build a hybrid cloud that powers and helps target its inbound marketing campaigns. Whether or not you want to get targeted in-bound marketing, these are real use cases for the technologies that will impact actual users.

Key to OpenStack success? Making it disappear

As Florian Otel, head of HP Cloud Services in EMEA, told a session on enterprise use of OpenStack, that many of the technical gaps in the software have been filled over the past year and folks now have to focus on real customer value.

“Remember how many years we heard this would be the year of Linux on the desktop? That never happened. Android is what it took to make Linux attractive to desktop users,” he said. By bundling the underlying technology with hardware and a problem to solve and an application to solve it, Linux in another guise is hugely popular, he said. For those who would quibble with his Linux analogy, he added: “Linux has as much to do with Android as iOS has to do with BSD.

The same will be true for OpenStack he noted. As it becomes a platform or an enabler for higher-level services, it will take off.

Now, to get back to kale: The metaphor unravels a bit because most folks use kale as an adjunct to other foods (although not always) while the goal is for OpenStack to be the basis for a whole realm of services — for enterprise users, for mobile users, for fill-in-the-blank constituencies.

The big question this time next year will be how much of OpenStack is being consumed by the masses — whether they know it or not.

Feature photo courtesy of Flickr user by Nick Saltmarsh

Disclosure: Piston is backed by True Ventures, a venture capital firm that is an investor in the parent company of this blog, Giga Omni Media. Om Malik, founder of Giga Omni Media, is also a venture partner at True.

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San Francisco-based Cloudscaling is one of the new-look OpenStack cloud providers. Unlike HP, IBM, Red Hat and even Rackspace, it doesn’t have to retrofit OpenStack into its legacy hardware or software and instead can focus on new applications and workloads.

On Monday, Cloudscaling said it’s teaming up with Juniper Networks and will use that company’s Virtual Network Control to enable a new Virtual Private Cloud (VPC) feature that maps to VPCs in Amazon’s public cloud. Cloudscaling said its VPC can isolate elastic cloud resources from the outside world “without sacrificing the core benefits of elastic clouds.” Juniper and Cloudscaling will also work together to deploy Cloudscaling’s Open Cloud System 2.5 in customer accounts.

Cloudscaling CEO Michael Grant.

The advantage of partnering with Juniper is that the company — by virtue of its acquisition of Contrail Networks — is moving into the software-defined networking market, Cloudscaling CEO Michael Grant said in an interview. SDN support means companies can rely on standard, inexpensive hardware and reconfigure it as needed in software.

Cloudscaling is much smaller than many of its OpenStack colleagues/competitors and it made waves by announcing support for not only AWS APIs but with Google Compute Engine APIs as well — a bet that GCE, when it comes out of preview mode, will become the second largest public cloud available, Grant said. Fidelity with key AWS services is crucial — hence the new VPC capability — because the goal is to let customers move workloads and data up into the biggest of the big public cloud infrastructure with minimal muss and fuss. Oh, and bring it back down again, as needed.

Hewlett-Packard has likewise made a big bet on OpenStack and this week said it has enabled HP CloudSystem, its private cloud, to “burst” workloads into other clouds. The Register has a more in-depth look here. Also by virtue of its support for the latest Openstack’s “Grizzly” release, OpenStack customers can use HP’s 3Par virtual storage. One key benefit of Grizzly is that it lets companies  mix and match storage subsystems from different vendors and manage them from one console.

With so many OpenStack clouds, what about interop?

Now that there are so many OpenStack clouds coming on line, the OpenStack Foundation and its members will have to address nagging concerns about interoperability between the various open source clouds.

The OpenStack challenge is to offer a common denominator of interoperable technology that also acts as a foundation for higher-level services that vendors can provide.

As Cloudscaling CTO (and OpenStack Foundation board member) Randy Bias explained recently: “The foundation needs to put a stamp on OpenStack — something like SQL 92  in the database world. Every [major relational] database — SQL Server, Oracle, MySQL, runs that set of commands but then they diverge.The foundation’s intention in the short term is to put a stake in the ground around that baseline interop.”

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I have no numbers for the AWS event but as of Tuesday night, the count for OpenStack Summit is 2,400 registered attendees up from 1,314 for last year’s San Diego extravaganza, according to an OpenStack source with access to that data. (The data is here and here is a readable, updated count.)

Rackspace, HP pack OpenStack show

Rackspace, one of OpenStack’s granddaddies along with NASA — has registered 199 216 people — a number which one OpenStack member characterized as overkill. Hewlett-Packard, depending on how you count or spell it, has 169 171 people or so on tap. Here’s how that list breaks out: HP (85), Hewlett Packard with no dash (30); Hewlett-Packard with dash (22); HP Cloud Services (21) and HP Cloud (7), Hewlett Packard Co. (4). Seriously, HP, what’s up with that?

Red Hat is on with 74, IBM with 72 and the list goes on. What I’ll be looking for, however will be real, live OpenStack customers which are starting to trickle out. OpenStack Foundation member Cloudscaling (which registered 14 summit attendees) just announced video game publisher Ubisoft as a customer and already has claimed LivingSocial and IBS Datafort as reference accounts.

Structure 2011: Werner Vogels – CTO, Amazon.com

Some other interesting tidbits from the OpenStack Summit attendee list: Controversial foundation member VMware registered a whopping 4 22 people. VMware bought Nicira, a big OpenStack player in software-defined networking. And non-member Oracle registered 14 people. Interesting. Oracle is going its own way with cloud but recently buy bought Nimbula, an OpenStack member.

The new OpenStack Grizzly release will be front-and-center in Portland.

Amazon to tout OpsWorks, other enterprise-class services

Meanwhile, on the other coast, AWS CTO Werner Vogels will probably talk up AWS’ value to the enterprise and tout its new-and-improved cloud management features and services including OpsWorks lifecycle management offering and RedShift, Amazon’s inexpensive data warehouse alternative to Teradata, Oracle, IBM and HP products.

AWS, a favorite among developers at startups and big companies alike, still needs to persuade  financial services companies and organizations in other heavily regulated industries that its public cloud infrastructure can be trusted for sensitive workloads — things beyond archival storage. And, there are indications — including the private cloud it’s allegedly building for the CIA that it’s getting over its aversion to private cloud deployment as well.

OpenStack clouds are starting to gel — at least at some customer accounts. What remains to be seen is which of the many OpenStack cloud providers will gain traction. And meanwhile, AWS continues to chug along.

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The goal of Project Moonshot, as initially stated in November 2011 and reiterated seven months later, is to offer super energy-efficient and compact servers capable of running the world’s biggest webscale (and biggest enterprise) workloads at a fraction of the cost of current hardware. HP said it shipped a number of early versions for customer proofs-of-concept last year but today’s news represents broad availability of what HP execs called a “software-defined server designed for the data center.”

The new server puts 4,500 Proliant servers into one HP 1500 enclosure. Compared to traditional Proliant (DL-380) servers, this iteration uses 89 percent less energy, 80 percent less space and is 97 percent less complex than the former state of the art at 77 percent less cost.

It’s understandable, given HP’s huge server installed base in enterprises, why it lays out that particular comparison, but customers might be more interested in how Moonshot boxes compare with webscale servers from what used to be no-name rivals like Quanta, Inventec, and Wistron. Increasingly, those are the servers that are being forklifted into massive data centers.  The notion of BYO servers is also spreading. In January, Rackspace, the big hosting and cloud provider, for example, said it would start building its own servers.

That trend puts traditional server vendors like HP, Dell and IBM in a tough spot. It’s good to see HP willing to cannibalize its existing products — if it doesn’t someone else will eat its lunch anyway. But,the macro issue is whether most of those big web-scale workloads have already moved onto new “no-name” servers or plan to do so. It is clear that for many of these new companies, the name on the box is not as important as the box itself and very few webscale customers appear willing to pay a premium for a label.

Moonshot servers are based on underlying fabric from HP networking, said Mark Potter, VP and GM of HP’s industry standard server (ISS)group. “This SDN switching is OpenFlow enabled so you can rapidly connect these computer architectures to any network,” he said during Monday’s web event. HP  is now running both 32- and 64-bit ARM-based Moonshot servers in the lab, he added.

Facebook outlined its wish list for webscale enclosures and servers which it pushed into the Open Compute Foundation. HP is part of that effort but it was unclear to me whether Moonshot servers will be fully Open Compute Project (OCP) compatible.

Update: Jim Ganthier, VP of marketing and operations in HP’s server group, confirmed that Moonshot is not OCP compatible but said the new servers would be great for powering similar webscale workloads.  He also took exception to the notion that HP server marketshare is being eroded by white box makers. Existing HP servers “power 8 out of 10 of the world’s most visited web sites and 3 out of 4 of the biggest social media sites,” he said. In addition, he said research like that from Gartner and IDC that shows branded servers — including HP boxes — losing ground to white box ODMs came out “before the world knew about Project Moonshot.”

So we’ll have to wait and see.

This report was updated at 9:19 a.m. PST with more detail on the servers and again at 12:55 p.m. PST with additional HP comment.

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Some HP board members stuck to their guns in the face of shareholder discontent. Three weeks ago, Rajiv Gupta told Reuters: ”Losing some of our directors in an abrupt and disorderly manner could undermine our efforts to stabilize the company … What the company needs now is stability and consistency of leadership so that the Board and the management team can devote all of their focus and energy towards executing on our strategic plan.”

 So much for that. By now, it’s apparent that  some of those challenges resonated. Directors John H. Hammergren and G. Kennedy Thompson have decided to leave the board, leaving two slots open for HP to fill. Both directors will continue to serve until the May board meeting, according to the release. Many have blamed HP’s myriad troubles on its inept board, including the CtW Investment Group, an arm of labor federation Change to Win that filed a letter in February asking for Lane to be removed as chairman. The group blamed the retiring directors and Lane for the debacle that is the Autonomy purchase.

Cleaning house might be the first step to getting the company back on track after what has been a tumultuous couple of years since the company deposed Mark Hurd as CEO and Chairman in 2010 after a sexual harassment scandal. Lane’s tenure has been rocky to say the least. He came on as chairman at the same time as former SAP CEO Leo Apotheker was named CEO and presided over the company’s problematic — and extremely expensive — acquisition of Autonomy for more than $13 billion.

That acquisition — which was Apotheker’s baby but got board approval —  raised eyebrows even at the time it was announced with many observers calling Autonomy wildly over priced. That assessment turns out to have been true. HP subsequently wrote off  more than $8 billion of that purchase and pushed U.S. and U.K authorities to investigate alleged fraud on the part of former Autonomy management. The fact that the purchase passed muster in the first place though focused more eyes on HP’s board.

In a release announcing his move on Thursday Lane said:

“After reflecting on the stockholder vote last month, I’ve decided to step down as executive chairman to reduce any distraction from HP’s ongoing turnaround,” said Lane. “Since I joined HP’s board a little over two years ago, I’ve been committed to board evolution to ensure our turnaround and future success. I’m proud of the board we’ve built and the progress we’ve made to date in restoring the company. I will continue to serve HP as a director and help finish the job.”

The one question some shareholders may have is why Lane, who is a partner emeritus at VC firm Kleiner Perkins Caufield & Buyers,  remains involved at HP at all.

HPQ data by YCharts

This post was updated at 11:15 a.m. PST with director comment.

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