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Dell Sets Different Cloud Path Than HP, IBM

AUSTIN, Texas—Dell is partnering with Red Hat to jointly engineer the open-source OpenStack cloud platform for enterprise deployments and will offer it to customers on its hardware, a move that differentiates Dell from such rivals as Hewlett-Packard and IBM in the increasingly competitive cloud computing space.

At the same time, CEO Michael Dell, in his keynote here Dec. 12 at the Dell World 2013 show, announced partnerships with public cloud providers Google, Microsoft's Azure and CenturyLink. Dell also signed a four-year agreement with Accenture to jointly develop and sell enterprise technology solutions, including offerings around cloud computing.

The partnerships add to previously announced support for such public cloud providers as Joyent, ScaleMatrix and ZeroLag. They also begin to build out Dell's cloud plans, which analysts had been wondering about since earlier this year, when Dell executives pulled back on their plans to build their own public cloud, as HP and IBM are working to do.

Dell and Red Hat have collaborated on Linux for more than a dozen years. In their latest partnership, Dell and Red Hat will co-develop cloud offerings that will run Red Hat's Enterprise Linux OpenStack Platform (RHELOP), which is part of Red Hat Enterprise Linux (RHEL) 6.5, which was released last month. In addition, Dell will offer a range of services for the solutions, from configuration to support for organizations using RHELOP—and not only for Dell customers, but those of IBM, HP and others.

Joint solutions will begin hitting the market next year.

"It's an excellent strategy," Patrick Moorhead, principal analyst with Moor Insights and Strategy, told eWEEK.

Dell has the chance to be a key player in the cloud space without having to spend the money needed to build its own public cloud to compete with HP and IBM, and with Red Hat will develop what could become the leading OpenStack offering, similar to what Red Hat did with Linux, Moorehead said. HP, IBM and Rackspace all use OpenStack, he said, though they've had to create their own versions of the open-source platform.

"Dell has a front seat at what could, over time, be considered the 'gold standard' of OpenStack in the enterprise, just like RHEL," Moorhead wrote in a column on Forbes. "For customers who start by choosing their flavor of OpenStack, this could give Dell an advantage with customers who want the most open version of a platform."

Dell has been growing its presence in the cloud. In May, the company introduced its Cloud Partner Program for public cloud providers, and will add to it with Microsoft, Google and CenturyLink (though Amazon Web Services is absent from the lineup). However, since setting aside plans for its own public cloud, industry observers have been wondering what direction the company would take.

In an interview here with eWEEK, Michael Dell said it didn't make sense for Dell to jump into what is already a busy public cloud market.

"You look at the public cloud, it's a very crowded space," he said. "You've got tons of companies; every company is sort of rushing to that. … I sort of look at this and say, 'Gee, you've got all the telcos running in, IBM, HP, Amazon, Rackspace, Google, AT&T, Verizon.' … It's going to get pretty messy."

In addition, both Michael Dell and Marius Haas, chief commercial officer and president of Enterprise Solutions at Dell, noted that the company already sells hardware to many of the top public cloud providers.

"Nearly all of the providers are our customers for their infrastructure," Haas told eWEEK. "Why do I want to compete with them?"

Dell executives also weren't willing to spend the type of money needed to create their own public cloud, seeing partnerships as a better and smarter way to go, Haas said.


Originally published on eWeek.
This article was originally published on December 13, 2013
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