Hewlett Packard Enterprise and Mirantis cut OpenStack staff

Each company has been a core OpenStack contributor in recent years, and now they’re both laying off OpenStack workers

hp layoffs challenges managers

Hewlett Packard Enterprise and Mirantis - two of the most instrumental companies in the open source cloud computing project OpenStack - have each laid off employees in recent weeks, according to the companies.

The full extent of the layoffs at HPE is unknown but ComputerWorldUK last week quoted Canonical founder Mark Shuttleworth as saying that HPE had laid off their “entire OpenStack team.” An official with HPE confirmed there has been a restructuring but would not say how many OpenStack workers were cut, adding that Shuttleworth’s statement is exaggerated.

Shuttleworth also said that Mirantis cut about 300 OpenStack developers, but the company’s co-founder and Chief Marketing Officer Boris Renski says the number of cuts at the company is less than 100.

Officials from the OpenStack Foundation – who are in charge of developing the open source code that makes the project – would not comment on the layoffs specifically but said they’re not indicative of weakness within the open source community, which they say is healthy and growing.

HPE’s tumultuous two years

A spokesperson for HPE confirmed there were cuts made in mid-October as part of a “company-wide strategy to give HPE the needed workforce to be a more nimble customer and partner-centric company.” Spokesperson Erik Denny added that reports that HPE cut all of its OpenStack employees was incorrect; the company still employs OpenStack technical experts, he says.

Sources familiar with the layoffs at HPE says the cuts have been motivated by multiple factors. First, there’s been a broad restructuring since the November 2015 split of Hewlett Packard Enterprise from the consumer and printer company HP Inc. In April of 2016 HPE announced a spin-off/merger of its non-core software assets with Micro Focus as part of an $8.8 billion deal, which caused a new shakeup of employees.

A source close to HPE says that since that deal was announced most of the workers in the company's platform as a service (PaaS) business and IaaS cloud business have been laid off. The source, who would only speak on the condition of anonymity, said there are rumors within the company that HPE may sell its OpenStack Helion software assets but continue to white-label market them. SUSE, a Linux distribution company which has its own OpenStack distribution, is seen as the most likely target to buy HPE’s cloud assets. Earlier this year HPE announced that SUSE was it's "preferred" Linux partner and that the companies would work together on OpenStack. 

Mirantis cuts stem from acquisition

The cuts at Mirantis happened after the company acquired TCP Cloud, a company that offered a hosted version of the open source cloud that it sells to customers as a service. Following that acquisition Renski said there was a need to “balance pure software engineering culture with operations expertise.”

Two groups at Mirantis were impacted by the cuts. The Fuel project, which made a simple OpenStack installer, is being re-architected to focus on “infrastructure as code,” Renski said. A second group of employees who focused on an internal PaaS project will shift to work on growing the company’s support for the open source container orchestration project Kuberentes. “We are not abandoning OpenStack and we are not exiting (the) OpenStack distribution business,” Renski wrote in an email.

What it means for OpenStack

HPE and Mirantis have been two of the most influential companies in the OpenStack community. In 2015 workers from HPE and Mirantis were the top two contributors of new OpenStack code. In the latest release named Ocata that will be available next year, HPE dropped to contributing the sixth most amount of code to the project, according to the website Stackalytics.com. Mirantis’ contributions have dropped from contributing 19% of the code in the Newton release this year to 12% for next year’s Ocata release.

OpenStack Foundation Director Jonathan Bryce could not comment publicly on the layoffs, but said the overall OpenStack project is healthy and growing “We continue to add new companies and contributors,” he said. “You want to have a broad base of companies participate. The way they participate may shift and change, but that’s healthy for an open source project, which is measured by the sum of its parts not just by any individual or company.”

Foundation Chief Operating Officer Mark Collier added that the latest release of OpenStack had a record number of contributors. “What we see at the macro level are ebbs and flows between different organizations over time,” he said. “For us, it’s about the aggregate more than just the headlines.”

Copyright © 2016 IDG Communications, Inc.

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