The topic arose at the clouderati-filled Cloud 2020 meetup in Las Vegas last week (where someone suggested we’ll have a cloud duopoly of Amazon Web Services and Google) and it’s back in the public eye again this week with the general availability of Google Compute Engine. I think we might get an idea how the cloud computing market will play out by looking at the fast-food industry.

The analogy goes like this: Fast food restaurants offer their consumers essentially the same things as public clouds offer their customers – convenience, speed, standardization, flexibility and everything else that comes with not having to prepare a meal from scratch or deploy applications on physical gear. And if all anyone wanted was fast, cheap hamburgers, fries and maybe some sort of chicken sandwich, the more than 33,000 McDonald’s across the world would probably do the trick.

However, when I come to any major intersection in a big city (and even in some small towns), I usually see no less than two national fast food chains taking up corner real estate. If I drive a little down the road, I’ll likely see a few more, and possibly some regional chains thrown in, as well.

Not all hamburgers are created equal, it seems.

Why should cloud computing be any different? If all anyone wanted was a virtual server, they’d probably go with the omnipresent Amazon Web Services. But when features, price, security, network connectivity and related services come into play, it becomes easy to see why there’s such an appetite for more options.

Amazon is to McDonald’s as Google is to …

Amazon Web Services = McDonald’s and Yum Brands rolled into one: AWS is to the cloud what McDonald’s is to fast food. It was the first, it’s the biggest and it’s the best known. All things being equal, there would be no reason for anyone to go anywhere else for cloud computing because AWS delivers reasonable services at a fair price (sometimes downright cheap), is omnipresent and can pretty much handle whatever scale you throw at it.

Only, if we consider the virtual server the hamburger of public cloud, the object store the French fries and the cloud database a chicken sandwich, AWS starts to look like a lot more than just a McDonald’s. You might look at it more like Yum Brands, the parent company of Taco Bell, KFC and Pizza Hut. The Amazon platform is about far more than just machine images and some standard storage and database features. It has myriad services covering everything from configuration to big data, and they’re all designed to integrate tightly with one another — like one of those KFC/Taco Bell combination restaurants that dot the urban landscape.

AWS, like McDonald’s, is the undisputed champion. Source: Wikipedia Commons

Rackspace = Wendy’s: Wendy’s is the No. 2 fast-food franchise in the United States, a title I think Rackspace probably holds in the cloud space (although assessing cloud market share is a little more difficult than assessing fast-food market share). And much like Wendy’s places a premium on the quality of its products, Rackspace places a premium on the quality of its service. CEO Lanham Napier has gone so far as to say it’s “playing a different game” than Amazon.

What he means is that Rackspace doesn’t need to compete with AWS by constantly driving down prices because Rackspace customers value service and will pay for it. Maybe, but the company might take a hint from what’s happening with Wendy’s as it struggles to maintain its No. 2 status against a feisty Burger King that’s largely following the McDonald’s playbook. If market share is important, higher prices aren’t often the best recipe for maintaining it.

The Angry Whopper, like App Engine, probably isn’t for everyone.

Google = Burger King: That cloud version of Burger King nipping at Rackspace’s heels is Google. It already has all the standard fare in servers, storage and databases, but it’s also hipper than the rest (or at least it tries to be), it takes some chances on product design (sometimes to the love-it-or-hate-it extreme) and, like Burger King with the Whopper, what it does well, it does really well. In Google’s case, that’s perform at scale.

If Google keeps adding services and cutting the costs of everything, there’s no reason it can’t become the world’s No. 2 cloud provider — some have already bestowed that honor upon it — and maybe challenge AWS a decade down the road.

Microsoft = Arby’s: Despite Microsoft’s best efforts to market it otherwise, Windows Azure is still largely viewed as a cloud platform for running .NET applications and generally doing all things Windows. Not that that’s a bad thing — a lot of people really like Windows and, by many accounts, Windows Azure is a fine platform. It’s like going to Arby’s: the menu offers a lot of things, but you go for the roast beef.

Joyent, Virtustream, CloudSigma et al = In-N-Out Burger, Culvers, Five Guys et al: These cloud providers, like their analogous restaurant chains, are damn good at what they do and their patrons are loyal. They’re typically designed for maximum performance, maybe security, too, and will play around with new infrastructural or programming components in order to maintain their edge. They might even be the best at certain things and have some major customers (I’ve seen Maseratis leaving the In-N-Out drive-thru), but cost, geography or the desire to get a chicken sandwich, too, limit the number of users they can attract.

Yes, In-N-Out is delicious — and that’s about the entire menu.

VMware = Del Taco: According to my colleage Barb Darrow, VMware’s new VMware vCloud Hybrid Service will “be run from partner data centers and sold by VMware’s channel but managed by VMware.” Del Taco sounds like a Mexican place but also has hamburgers, fries, shakes and even iced coffee. And I don’t know anyone who eats there.

OpenStack = Frozen French fries, or cheeseburger-flavored Doritos: It really depends on who you ask (some would even say it’s like kale). If you’re grilling burgers and cooking fries, you’re essentially trying to recreate the fast-food experience at home. On the bright side, when you’re making the hamburger patties and cooking the fries, you can control how much salt you add and ensure everyone who handles them washes their hands. It might turn out great, but it’s never really the same.

Perhaps I’m being overly pessimistic, but I’m beginning to suspect that OpenStack-based public clouds (of the non-Rackspace( rax) variety) will end up being a lot like cheeseburger-flavored Doritos. In name, they’re like cheeseburgers, but after a few bites you’re left saying, “Hey, Doritos doesn’t make cheeseburgers …”

Everyone else = everyone else: Even after all this, we’re still left a bunch of different cloud providers and a bunch of different fast food chains. You might compare the telcos to Jack in the Box, Carl’s Jr. and Hardees in that they’re big and make money, but they’re pretty much non-factors in the grand scheme of things. Then there are your various web hosts and others, which might compare with some local chain restaurants. And different countries will certainly have their own cloud providers just like they have their own takes on fast food.

In the end, though, it’s just hard to see how cloud computing becomes a two-horse race any more than the fast-food industry is a two-horse race. Sure, there are three clear leaders (with No. 1 having a big lead), but there’s plenty of business to go around because aside from some core similarities, no two providers are the same. And as long as more applications are developed and need a cloud to call home, there will be developers and CIOs with very different ideas of what makes a cloud platform great.

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That the new release of Ceph, dubbed Cuttlefish, focuses on Red Hat is interesting since Red Hat bought Gluster for its scale-out storage capabilities in 2011 and declared Gluster to be “OpenStack Ready” last month.

The consensus at OpenStack Summit was that Ceph has advanced faster than the Swift storage module that came out of Rackspace and which handles object storage only. But the promised appeal of OpenStack is that users can swap in and out compliant plug-ins as needed for different functionality.

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There’s a paradox in the cloud vendor community. All the players agree there is tons of demand for cloud and cloud services — at least for their cloud and their cloud services. The future is bright, the upside enormous.  But when pressed, many also say that we’re due for lots of consolidation — that there really isn’t market demand for umpteen different cloud flavors and the vendors that sell them. In short demand is great for my cloud, but not nearly enough for all these other guys’ clouds.

Last week’s news that Xeround is shutting its doors sparked this talk anew. Xeround gave users of its free database service just over a week to vacate the premises and paying customers two weeks. There have been other examples of cloud services shutting down.

One cloud watcher who requested anonymity because he works with many of these services said many companies who “tried to do free have gotten their heads handed to them. And other cloud services companies are consolidating the number of cloud infrastructures they support because “API bloat has gotten horrific.”
So what goes on here? The gist is we are really early in the cloud business and there will be a ton of work. But is there enough work for 90 different OpenStack players plus CloudStack plus Eucalyptus along with Amazon? Or 50 cloud database providers or Platform-as-a-Service providers? Um, not so sure.

In an interview at the OpenStack Summit last month, OpenStack executive director Jonathan Bryce applied his own paradox when asked if he expected there to be more or fewer OpenStack players going forward. “The answer is both. Over time you’ll see a greater variety of vertically oriented flavors of OpenStack — versions built for highly secure, highly regulated workloads but you’ll also see a number of general-purpose versions that will solidify.” Solidify. Hmm.

At the summit, HP cloud master Saar Gillai said he expects consolidation. OpenStack is much more complex than Linux — it includes complicated networking and storage as well as compute aspects. Building and testing all that takes money and if a company cannot make money off its work, it won’t be in the business long.

Given all that would-be cloud deployers really need to assess the risks — and mitigate them going in, as Derrick Harris wrote Friday.

When is a cloud not a cloud?

Amazon, the dominant public cloud company, is sick of the hype around private clouds. All too often these private implementations do not offer the true benefits of a public cloud, at least according to Andrew Jassy, SVP of Amazon Web Services.

At Amazon’s Global Summit Series event in San Francisco last week,  Jassy slammed private cloud purveyors for selling what is not, in actuality, a cloud at all. Citing a survey by Forrester Research, just 24 percent of companies surveyed had self-service provisioning; 14 percent could charge back costs to their departments; and 27 percent had built resource automation, according to Nancy Gohring over at ITWorld. 

Covering the same event, The Wall Street Journal quoted other Forrester numbers however. These hold that nearly one-third (31 percent) of companies in North America and Europe have deployed private clouds with another 17 percent planning go do so by next year. On the other hand, just 10 percent say they have adopted public cloud with another 7 percent saying they plan to do so. No wonder AWS is so grumpy especially given the emphasis it’s put on winning over enterprise workloads that go beyond test-and-dev and that it will face more public cloud competition — from HP, from VMware, from Pivotal, from IBM( s ibm), going forward.

It was interesting that, at the same event, AWS trotted out Nokia to talk about moving its analytics over to AWS’ RedShift, given Nokia’s tight relationship with Microsoft in the mobile phone arena. In mid-April Microsoft made its Azure IaaS, which competes with AWS, broadly available. One might think Microsoft would really, really want companies like Nokia to use Azure.

Oh, and by the way, last week Microsoft said its cloud business reaped $1 billion in sales over the past 12 months, a figure that raised many eyebrows. The cloud number includes Azure but also software deployed at sites run by partners — partners like Rackspace and Amazon. We live in a complicated world.

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Now Shuttleworth, who used tens of millions of his own dollars to fund Canonical and made it his ambition to entrench Ubuntu Linux on desktops and servers is now launching a full-on assault to put it on your smartphone, your tablet and the computers that run your favorite cloud services via OpenStack.

Taking on the giants

It’s a gutsy bet. He’s basically taking on Google’s Chrome Browser, ChromeOS and Android OS. And then there’s iOS. Not a job for the faint of heart. In a recent interview with GigaOM,  Shuttleworth said a key Ubuntu advantage is that its basic code really does run everywhere from itty-bitty mobile devices to big iron. No Android-Chrome OS divide here.

“The core of Ubuntu that runs on the server is the same as on the phone and that’s a wonderful resonance,” Shuttleworth said. “We’ve done  pioneering work to put server Linux on ARM chips and the core of those ARM chips is the same for servers as it is for smartphones,”  Shuttleworth said.

Admittedly, it’s still early days for running ARM servers in a production environment — my colleague Stacey Higginbotham reported that Baidu is doing it — for storage — but few others are. But the need for energy-sipping servers is not going away. And ARM servers address that demand.

As more cloud services get delivered via smartphones and tablets, all that “resonance” could come in handy. But timing may be a problem. Android and Apple iOS, which dominate that smartphone and tablet market now, will be hard to dislodge. If you believe Google Chairman Eric Schmidt — a biased observer — Android Android’s growth rate is, is on track to hit 1 billion downloads within the next 6 to 9 months. And, to further complicate matters, Microsoft seems willing to spend big to build its presence in smartphones and tablets as well. As much money as Shuttleworth has, Microsoft has more.

Seemingly undaunted, Shuttleworth says Ubuntu is getting serious looks from silicon providers, from carriers and from handset makers who are interested in offering it on their devices. He declined to provide names. It is true that Google’s acquisition of Motorola’s mobile assets still worries third-party handset makers who don’t relish the thought of competing with their OS provider, but that doesn’t seem to have slowed Android adoption.

Ubuntu shows strength in cloud

Ubuntu is already a big presence in the cloud by virtue of Amazon Web Services where it is the most popular operating environment on EC2 — at least as measured by the Amazon Machine Images (AMIs) that people create. “The number of AMIs running Ubuntu is 5 or 6 times as many as Windows or any other operating system,” said Stephen O’Grady, principal analyst with Redmonk. One caveat is that people create lots of AMIs that they may not actually use, cautioned The 451 Group analyst Carl Brooks.

And Ubuntu came earlier than many other vendors to the OpenStack party. It’s got a leg up in the enterprise two years ago when  HP named it the lead host and guest OS in HP’s OpenStack cloud. That relationship continues to this day.

Shuttleworth also said Ubuntu’s OpenStack gets tons of interest from telcos and carriers that are rushing to create their own cloud services to better compete with AWS. One theme coming out of the OpenStack Summit last month was that these sleeping giants, many of which offer VMware vCloud Director options that price them out of the market, are finally waking up to the threat that AWS poses to them. And that is something Shuttleworth feels Ubuntu, with Canonical behind it,  can capitalize on.

“We are in a very good position when carriers want to look beyond standing up OpenStack to what the end-user experience is,” he said.

In his view, Ubuntu more than other Linux OpenStack flavors, offers simplicity and power — a claim that other OpenStack players would likely dispute. Linux rivals Red Hat, SUSE and are also all in the mix here. And Nebula’s selling point is its OpenStack controller that makes it easy to plug OpenStack into existing legacy environments. There will be a ton of competition among the OpenStack providers even as they all contend with CloudStack and Eucalyptus options.

Shuttleworth maintains Ubuntu’s advantage, however.

“We really are at the point where you can take a USB with Ubuntu, stick it on 1 to 300 servers and in a short period have a high-availability cloud — compute, storage, and network — up and running that provides a lot of value,” he said. “This is real and it’s helping people get over the conceptual hurdle of moving to cloud. It’s at the point where you can have ten people debating it for a week or you can just go and do it — the cost is low enough and the lessons are valuable enough to make it happen.”

But what about revenue?

There’s one not-so-small hitch here. As many good reviews as Ubuntu Linux has gotten, the revenue or profit picture is about as clear as mud. Canonical’s business model is that customers pay for support and maintenance on free software. But the privately held company won’t say how many people actually pay for any of that. And it doesn’t talk about how much money Shuttleworth has ponied up since founding the company in 2004. The question is whether Canonical (and Ubuntu) could stand on its own without his deep pockets. Face it, it’s hard to take a customer from free to non-free.

When it comes to questions about revenue or profitability, Canonical will only say that customers including PC, phone and tablet manufacturers and big companies that deploy Ubuntu at scale  use Canonical’s paid tools and services to support their server, cloud and client environments.

That may not be enough detail for enterprise buyers who want to know if the vendor they use today will be around next year or the year after. For a company that has such grand plans for a free operating system, Canonical needs to address these questions at some point.

Shuttleworth will be talking about his grand cloud vision at GigaOM’s Structure Europe in London in September, so here’s your chance to ask.

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By supporting these tools that help deploy, run and monitor workloads on AWS, Eucalyptus is going a step beyond supporting the bare-bones AWS APIs, Eucalyptus CEO Marten Mickos said in a recent interview.

The new Eucalyptus 3.3 release, due in May, will support Chaos Monkey for testing the limits of a cloud deployment under stress; Asgard for automating deployment of large-scale applications; and Edda, a dynamic querying tool, for polling AWS resources.

“For Eucalyptus customers, this is real proof of AWS compatibility. Other folks who say they are AWS-compatible really aren’t — the real proof of the pudding is in supporting these Netflix tools,” he said. ”We’re not saying that everyone in the world will start using Asgard, although many will.”

That Eucalyptus would throw its lot in with Netflix is not shocking. Mickos and members of the Eucalyptus team attended the Netflix OSS open house in February. Netflix used that event to promote the use of its open-sourced cloud management, testing and monitoring tools by third parties, at least partly so that cloud alternatives to AWS will emerge.

Netflix is one of the biggest and most skillful AWS customers. Netflix tools fill gaps in AWS and help it run better. But Netflix is also acutely aware that Amazon has a streaming video service that is a direct competitor to its own core business and would very much like there to be another cloud out there that is as scalable and price efficient as AWS.

In the open-source cloud world, Eucalyptus contends with a slew of OpenStack players as well as OpenNebula and CloudStack.  But there is concern that the market, as young and potentially big as it may be, will not support all these options. Talk at the recent OpenStack summit and beyond is that there will be consolidation of the contending vendors.

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 A RightScale survey released last week said  bigger companies — those with more than 1,000 employees — are “slightly more likely” to claim  cloud adoption than their smaller brethren: 77 percent of large companies surveyed said they’re adopting cloud in some form compared to 73 percent for smaller companies. The survey reinforced what RightScale CEO Michael Crandell says all the time: most companies want to use multiple clouds to avoid over-reliance on one provider.

Of course companies like RightScale and competitors like Enstratius and Server Density, which promise  a single dashboard for multiple clouds, have a vested interest in multi-cloud being the adoption mode of choice. So do most of the cloud providers who fear a world were Amazon Web Services will become the cloud standard.

Meanwhile, Amazon Web Services keeps chugging along. For Amazon’s first fiscal quarter, the business category including AWS, logged $750 million in net sales, down from $769 million from the historically strong fourth quarter, but still a pretty impressive number.

Mobile cloud access is hot hot hot

Not that it’s a surprise, but mobile is big. More people tap their cloud services with their tablets and smartphones instead of (or in addition to ) their PCs. that’s why Facebook bought Parse, the mobile backend as a service (MBaaS) provider.  And why AWS is bulking up its mobile development efforts. And also why Rackspace and Salesforce.com are building up their own mobile development portfolios.

All of that activity comes after Apigee’s acquisition of UserGrid, a pure-play MBaaS and Appcelerator’s buy of CocoaFish. It’ s clear that expertise in mobile development platforms is a huge draw right now.

The takeaway from this activity? Expect more “acqui-hires” by big companies of mobile back end services players.

What’s up with Dell cloud?

In January, Dell said it would hold off on its public OpenStack cloud until the fourth quarter and two week sago it announced a partnership with SUSE to build out its private OpenStack implementations. Under that pact,  Dell will package up SUSE’s OpenStack implementation on Dell hardware in a sort of easy-to-plug-in cloud appliance. In the background, the battle raging around Dell’s future ownership model has had to be a distraction. That may start easing up since Blackstone, which had been mulling its own bid, reportedly dropped those plans last week.

And, in a surprise appearance at the annual Silverlake Management conference in New York, company founder and CEO Michael Dell said IT security and cloud computing are key customer pushes for the company going forward — and  defended the much-maligned PC business in a world obsessed with smartphones, according to Bloomberg News. 

Mr. Dell is partnering with Silverlake to take his company private in a deal valued at about $24.4 billion when it was announced in January.  Some shareholders, including Southeastern Asset Management, which owns about 8.4 percent of Dell shares, and Carl Icahn characterized that as a sweetheart deal that undervalues the company.

There’ll be lots of cloud infrastructure talk, including on mobility, at Structure 2013 in San Francisco June 19-20. Please join us.

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New features

First off, the default installation is for a virtualized environment. As Mark Baker, Ubuntu Server product manager at sponsor company Canonical, told me, this is because users are increasingly deploying the OS on hypervisors and Canonical wants to show off the OS’s capabilities there.

“While KVM has been big on Ubuntu since 2008, it’s not the only game in town,” Baker said. “We’re seeing customers wanting to understand integration or compatibility between ESX and Ubuntu, or even Hyper-V and Ubuntu, and we’re ensuring testing on these – and of course KVM and Xen — so when we are engaged with customers or users we can say we know Ubuntu provides a robust experience on the prevalent hypervisors.”

The other major aspect of this release is its integration with the new Grizzly release of OpenStack. Canonical has been involved with OpenStack since the start, and the release cycles for the two products are aligned (Grizzly came out a few weeks ago).

Ubuntu 13.04′s Juju orchestration “charms” have been updated to deploy OpenStack for high availability – for example, when the user deploys MySQL, the charm will set up 3 nodes in a failover configuration, and a similar approach applies to the deployment of the Rabbit messaging server. Of course, those deploying in a test environment won’t be too keen on running 2 or 3 of everything, so it will still be possible to install in a “less highly available way”, as Baker put it. The Juju GUI has also seen a lot of work this cycle “to improve usability”, he added.

Meanwhile, the Ceph storage subsystem is now fully integrated with Ubuntu and OpenStack, in order to please Canonical’s telco and service provider clients, and Ubuntu’s Floodlight OpenFlow controller has also been updated. Although Canonical and VMware are working closely on Nicira, “having an open-source alternative to Nicira is also important,” Baker pointed out.

Carrier adoption

Speaking of carriers and service providers, this is the market segment where Canonical appears to be thriving.

“OpenStack certainly has been the biggest growth areas for us in the last 12 months,” Baker said. “We have got engaged with the types of customers that we could only have dreamed of, looking back a few years. OpenStack is gaining adoption with carriers, and most people doing that to scale are doing that with OpenStack on Ubuntu. Most of the major telcos, the global names that you’ll see, are deploying their OpenStack on Ubuntu.”

Baker also claimed that OpenStack is seeing traction in the big data space, with users deploying Hadoop and Cassandra on Ubuntu – he suggested this may be out of “developer affinity” with the Linux distro.

“It’s fair to say the bread and butter of our user base is running web infrastructure,” Baker said. “A lot of that user base is moving that web infrastructure into the cloud. We’ve gained significant popularity on Azure – there is a fair proportion of that running Linux. While you wouldn’t think it a natural fit to provide Ubuntu on a Microsoft cloud, we actually think it’s quite exciting.”

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Adoption of products slated for release later this year have executives feeling hopeful about seeing this year’s total revenues. They should come in 14 percent to 16 percent ahead of last year when taking into account the removal of revenues and costs related to the Pivotal Initiative, Chief Financial Officer Jonathan Chadwick said on a call with investors. Last year’s revenue came in at $4.6 billion.

Following on VMware’s $1.26 billion acquisition of network-virtualization player Nicira, VMware will ship its NSX software, drawing on elements of Nicira software, in the second half of the year. NSX will lower customers’ capital and operational expenditures and “transform network operations in a non-disruptive manner,” said President Carl Eschenbach.

Eschenbach also said the vCloud Hybrid service will launch on May 21.

Rather than expecting a negative impact from the OpenStack movement, VMware CEO Pat Gelsinger said he sees OpenStack as offering “an expanding addressable market for VMware.”

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OpenStack Summit 2013

It’s earlier than you think

IThere was tons of energy and more than 2,000 attendees at last week’s OpenStack Summit but most of those were vendors that have signed on to the effort and hope to make money off it. The proof of the pudding will come when actual end-user organizations that are not necessarily tech companies start adopting.

451 Group analyst Carl Brooks estimates there are now a few hundred OpenStack projects in production now, 60 to 80 of which are in production. Of those 40 to 50 are run by service providers of which maybe 3 or 4 make money.

SAP seeks cloud cred

We all know that tons of startups and a growing number of bigger companies tap Amazon Web Services for storage and perhaps some compute loads, the vast bulk of corporate computing remains on-premises. We’re entering an interesting era in which the legacy powers — Oracle, IBM, SAP, are rushing to embrace cloud and reap fiscal benefits. SAP CEO Bill McDermott last week told the AP that the ERP giant “accelerated into the cloud in a big way about a year ago and already we’re making money on it.”

Not to get all Clintonian here, but much here depends course a lot depends on how you define “cloud.” SAP is most certainly lumping in any and all revenue coming in via Software-as-a-Service implementations where the company gets paid via subscription vs. big lump fund payments for software licenses. SAP said cloud computing contributed nearly $37 million to its first quarter earnings.

SAP’s favored child product, the HANA in-memory database, saw its year over year revenue triple to €86 million (or about $112 million) for its first quarter.

Muddying the waters

When the industry started down this path, AWS was the big, scalable public cloud — with an ever-growing number of services that startups used to write, test and then deploy shiny new applications. VMware plugged vCloud Director as the way for existing VMware customers (most big companies) to move their legacy applications to a VMware compatible cloud.

Cutting to the chase, and vastly oversimplifying the case, it was one cloud for new apps vs. another for

old applications.But things have gotten a lot more, um, nuanced, since then.  AWS has added more services to accommodate those older but still-mission-critical applications while VMware announced plans for its own public cloud (which it calls hybrid.) And VMware/EMC spinoff the Pivotal Initiative on Wednesday will talk more about its take on cloud computing.

Photo courtesy of Flickr user ahockley

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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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