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Dell dumps OpenStack and VMware for public cloud, focuses on private clouds

Rumors of a shakeup at Dell from last week have been confirmed

By , Network World
May 20, 2013 04:59 PM ET

Network World - Dell has dramatically shifted its cloud computing strategy, canceling plans it once had to launch a public cloud service based on the OpenStack open source platform, and discontinuing a VMware-based public cloud it already has on the market.

Instead, the company will focus on selling OpenStack-powered private clouds that run on Dell hardware and software. Using technology it acquired from cloud-management company Enstratius, Dell says its customers will be able to deploy resources to more than 20 public cloud providers. In announcing this change in strategy, Dell also said it has a new "partner ecosystem," consisting of just three providers now, but with plans to increase that number, which will provide integrations between those partner public cloud services and Dell customers' private clouds.

Launching an OpenStack-powered public cloud would have been an expensive investment for the company, which is mulling opportunities to go private, but Nnamdi Orakwue, vice president of Dell Cloud, said this shift is not related to the company's broader financial position as it deals with slumping revenues in some of its legacy business units.

[ MORE CLOUD: How VMware will try to shake up the cloud market this week ]

Dell has been a cheerleader for OpenStack, and for more than a year has said it planned to launch an OpenStack-powered public cloud. At the very end of last year the company said those plans had been somewhat delayed and the cloud would not be ready until at least the end of 2013. Rumors began swirling last week when Network World reported that Dell is "refining" its cloud strategy and multiple members of the team working on Dell's public cloud have left the company. Today, Dell released details of its new strategy.

Orakwue says the focus now will be on private cloud deployments for customers, and then secondarily consulting with customers to help them determine what the best fit for a public cloud is. Dell will work with customers who are already using the company's VMware public cloud -- which will be discontinued -- to migrate to another platform. Orakwue would not say how many customers are in that situation, but the news comes on the eve of VMware announcing details of its plans to launch a public cloud. He added that the new strategy is in no way a commentary on OpenStack as a platform for building clouds and reiterated the company's commitment to using the open source platform for building private clouds for customers and partners.

Dell is working with three providers who are part of its partner ecosystem, whose services will be optimized to integrate with its private cloud deployments, including Joyent -- a company known for its ability to offer high-performance cloud computing -- along with ZeroLag and ScaleMatrix, two other small infrastructure as a service (IaaS) providers. Orakwue says Dell hopes to expand its partner program to include more providers.

Forrester cloud watcher James Staten says it's good that Dell is integrating technology it acquired less than a month ago from Enstratius, a powerful management platform that allows customers to deploy resources to a more than 20 public cloud providers, including all the major leading cloud companies like Amazon Web Services, Rackspace, Microsoft Azure and Google, among others.

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