​Link: Red Hat on its way to becoming the first billion-dollar-a-quarter open-source company

‘I’ll tell you something that’s not fantasy. In the next few years, Red Hat will become the first billion-dollar-a-quarter open-source company, and that’s real money… Here’s how. First, as Jim Whitehurst, Red Hat CEO, said in the earnings call, “We anticipate exiting the fiscal year with an annualized run-rate of approximately $3 billion for total revenue.”’

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RedHat selling more OpenStack, e.g., to Verizon

Whitehurst thinks no one is paying enough attention to Open Stack, the freely-available software stack. “We had three deals over a million dollars last quarter,” for Open Stack, said Whitehurst. “We are finally seeing it move into production in a pretty significant scale. Verizon [Communications] and others are running our Open Stack, and so to reach that production point is pretty exciting.”

Source: Red Hat Rising: Bulls Breathe Sigh of Relief as Linux Rebounds.

A tale of two ITs | Business Cloud News

“The challenges are cultural, organisational, and technical. According to the 2015 BCN Annual Industry Survey, which petitioned over 700 senior IT decision makers, over 67 per cent of enterprises plan to implement multiple cloud services over the next 18 months, but close to 70 per cent were worried about how those services would integrate with other cloud services and 90 per cent were concerned about how they will integrate those cloud services with their legacy or on-premise services.”

A tale of two ITs | Business Cloud News

How the pull nature of open source changes your partner strategy

In answering what Red Hat has to offer partners, CEO Jim Whitehurst says:

So when we talk about containers, we talk about, here’s how, if a customer wants to implement containers, you can offer solutions to help them do that. And when we want to talk about OpenStack, well, here’s how you can offer an OpenStack solution in a supported way to run production applications. Here’s how you can actually deliver products and services around DevOps with our OpenShift and PaaS offerings.

This is in addition to “curating” open source and doing the usual commercial support backing. That is: selling know-how and services, I suppose: meat-ware. The further angle is giving partners an answer to the never ending questions about cloud and containers:

Well, we actually now have things they can go sell, to say, “oh, you want to implement containers, I can bring you a solution to do that.” There’s a lot of things people are buzzing about. We actually have tangible … products that can let our partners go out and meet our customers’ needs.

Also, this in timing when demand will hit for the new fangled stuff:

[O]ur partners need to invest now to build, for instance, OpenStack skills and OpenShift skills, so as their customers over the next year, 18 months, say, “Hey, I want to do this,” they’ll be ready to go.

It’s a little bit, I think with some partners, the thinking is, “If I don’t see the demand now, I’ll wait till I see it to develop the capabilities.” But if you wait till that happens, then it’s kind of too late to develop the capability at that time. So it’s kind of getting that right sequencing.

Also, some interesting effects of the pull nature of open source. When you let demand grow in open source and then commercial it, you have to spend less time selling the problem that validate the product (the solution) you have:

And so, we are less out there trying to validate these solutions to meet a problem, which is what traditional vendors are doing when they write something. We are much more saying these solutions clearly solve problems and they are doing it for leading-edge companies today. We offer versions that are consumable for traditional enterprise. It’s very much, not just solve the problem, it is, “Here’s how we can help you solve a problem that we know is there, using a technology that we know is the right technology.” That’s the power of user-driven innovation.

As you might guess from a company that had a partner conference, parent selling is a big deal:

In the last year, we were 68 percent channel, and we certainly hope and expect that will continue to expand this year.

How the pull nature of open source changes your partner strategy

Building the new apps on cloud

Our most recent quarterly Voice of the Enterprise survey research indicates growing demand for Docker and containers. When we asked more than 700 of our extensive network of 12,500 senior IT professionals what their organization’s most common type of application deployment for cloud computing was, more than one-third (34%) said for deploying new applications that they did not have before the cloud.

We are confident that Docker containers represent some portion of this percentage of new applications. We also see Docker and containers playing an increasingly prominent role in other application-deployment priorities, such as modernizing existing applications by moving to hosted software or SaaS (35% of respondents), or migrating existing applications to cloud infrastructure (31% of respondents).

From Jay Lyman at 451.

Building the new apps on cloud