Now that they don’t have to compete with AWS, they have an extra $300m floating around in the spreadsheets:
“Ultimately now it’s about how are we going to build a stronger company. If we don’t have to go spend $300 million a year in capital competing against Amazon, building computing storage and networking, where should we go put that? In things like managed cybersecurity and professional services,” said Rhodes.
On OpenStack, finding the product/market for for private cloud:
And what about OpenStack, the open-source cloud computing platform that Rackspace created with NASA?
“We thought the world wanted another alternative to public cloud,” said Rhodes. “What we are learning is the world doesn’t need another public cloud, so OpenStack is shifting form and going private cloud.”
Also, cameo from my former 451 colleague Carl Brooks.
Of note is that 451 lists traditional hosting along with public cloud. You can see cloud gobbling up the pie: “cloud”‘s take of the revenue goes from 7% in 2010 to 28% in 2018.
I assume this is all “public cloud,” not private.
The company sells a public cloud platform, mostly based on OpenStack, to service providers who want to stand up their own clouds. A sampling of customers thus far from Agatha’s recent report:
the group claims to have deployed more than 1.4 million virtual machines for customers across the board, and enabled the commercial deployments of public cloud (T-Systems’ Open Telekom Cloud), hybrid cloud (Vodafone’s Vodaplex Hybrid Cloud Platform) and HPC (University of Warsaw’s Top500 HPC project’s HPC cluster).
Source: Huawei pushes further into the telecom market with its public cloud platform
IDC’s IaaS forecast is out, tragically, I don’t have access to it. However, here’s some highlights from the press release:
- Public IaaS is in wide use “A recent survey of over 6,000 IT organizations found that nearly two thirds of the respondents are either already using or planning to use public cloud IaaS by the end of 2016.”
- Public IaaS is a large, fast growing market – the overall IaaS market is forecast to grow from $12.6bn in 2015 to $43.6bn in 2020, a CAGR of 28.2%.
- Yup, fast growing – growth from 2014 to 2015 was 51%
- People use more than one IaaS, and probably “cloud” – “[H]ybrid cloud infrastructure is already a common pattern at several large enterprises and IDC predicts that 80% of IT organizations will be committed to hybrid architectures by 2018″ – notice they say “large enterprises,” which suggests a cut of the data by company size: last I recall, IDC defined “large enterprise” as 2,500+ people, which may or may not be the case here.
- A few cloud providers dominate – Amazon is still king, and there’s an fat-head of marketshare: “In 2015, 56% of the revenue and 59% of the absolute growth went to the top 10 IaaS vendors.”
Contrast that 60% IaaS usage with the 45% use in a recent Morgan Stanley CIO survey. I don’t think that’s a huge difference, but it does show the fiddliness of these kinds of surveys. To be fair, the Morgan Stanley survey has public IaaS usage at ~90% by 2019. I’d trust IDC a lot more, esp. with 6,000 surveyed vs. 100.
Also, while I can’t verify this: I’d assume this public IaaS is not to the exclusion of private cloud/on-premises. To be sure, some, or even much, of it must be public cloud gobbling up on-premises usage and revenue. However, I wouldn’t take it as a zero-sum game between the two.
Source: Enterprise Adoption Driving Strong Growth of Public Cloud Infrastructure as a Service, According to IDC – prUS41599716
Data from 451 Research’s Cloud Price Index suggests that IBM is missing a trick. By going all-in and baking SoftLayer with Bluemix, IBM would gain a leading position in the market in terms of completeness of services and global availability, as well as finally delivering a single user experience.
Owen over at 451 suggests that IBM hasn’t yet merged SoftLayer into Bluemix totally, missing out on a high ranking in cloud providers (by functionality, geographic availability, etc.). Also: “The company claims $10.2bn in cloud revenue, a growth rate of 46% Y/Y, and 20,000 new users per week.”
Source: CPI case study: IBM and SoftLayer would be greater together
Some new market sizing for public IaaS is out from Gartner. $16.5bn in 2015, out of a $3.5t pie of global IT spend.
For the first time this year growth of public cloud IaaS workloads outpaced that of on-premises workloads. One in 10 CIOs surveyed by Gartner say they have adopted a cloud-first strategy, while 83% consider IaaS a viable option to use
More on HP’s cloud re-positioning:
“HP is not leaving the public cloud market,“ said HP in a statement to CRN that mirrors a statement given earlier this week to VentureBeat. “We run the largest OpenStack technology-based public cloud out there. This has to do with not competing head-to-head with the big public cloud players.”
They’re going "enterprise” that is. And if you pay attention to analyst predictions and their surveys of what companies say they want to buy (mostly private and “hybrid cloud”), that’s likely OK.
When AWS’s financials come out soon, we’ll see what happens. No one (maybe Amazon who could search over their customer’s company names in their profile) really know how much “enterprises” use Amazon: it could be a lot, a little, a bread basket. Many people thing a lot, but existing vendors hope it’s a little.
The question will also be: is AWS additive to IT spend (companies find new things to run on AWS but keep their existing stuff on their “legscy” IT)…or are companies moving workloads to cloud.
The next bucket for modeling out thinking will be: when companies (and ISVs/SaaSes) make new applications, where do they deploy them? Most people would say public cloud, other would get nuanced about managed hosting.
More on HP’s cloud re-positioning, AWS financials
The public PaaS Magic Quadrante is out. We’re not listed on there, as you can see. Most of our business is in “private PaaS,” a different category Gartner. On the other hand, many of those blue dots are run by Cloud Foundry, some even with Pivotal Cloud Foundry.
Check out the huge landscape, though. Fun!