OpenStack: Contender or Pretender?

The open source Infrastructure-as-a-Service project has rocketed to prominence. Where does it go from here?

When VMware Inc. announced a new product -- VMware Integrated OpenStack -- at VMworld in August, it was a milestone. For the first time, VMware admitted (on its biggest stage) that OpenStack could no longer be ignored or minimized. It was a confession that the open source cloud platform had enough momentum from the industry to force VMware to find a way to get along; that there were enough organizations using it, or considering using it, that VMware risked being left at the station as OpenStack thundered down the tracks.

In other words, VMware declared publicly that OpenStack has arrived.

Zero to 60 in Four Years
That arrival took almost exactly four years: The first iteration of OpenStack, called Austin, was released Oct. 21, 2010. Back then, OpenStack was an interesting open source collaboration between RackSpace Inc. and NASA. Few would've predicted that it would take a central role in virtualization and cloud computing. But here we are, four years later, and OpenStack is everywhere, forcing virtualization vendors to scramble like mad to devise a strategy for dealing with it. Most, like VMware, are trying to integrate. Others are taking a different path. But one thing is certain: No one in this space can afford to brush it off.

"It's clear that OpenStack has a tremendous amount of momentum and money behind it," says Al Sadowski, research director for service providers at 451 Research LLC. He backs up his claim with some numbers, noting that there were about 1,500 community members in October 2011; the number now is more than 15,000.

Why? "The big reason is that people are looking for alternatives to proprietary platforms like VMware," Sadowski says. OpenStack "went from a small number of supporting organizations, to now more than 315 companies that have ponied up resources and money to support it."

The money is going the other way, as well. A market assessment from 451 Research projected revenue from OpenStack business models to grow from about $883 million in 2014 to $1.7 billion in 2016, and $3.3 billion by 2018. "That represents a compound annual growth rate (CAGR) of 40 percent for the six years ending in 2018," the report states.

Bandwagon Jumping
The OpenStack ascendance is creating a mammoth virtuous cycle: vendors see other vendors jumping on the bandwagon, which leads to more growth, which leads to more vendors hopping aboard. That growth has led competitors to see the wisdom of joining the OpenStack movement, rather than trying to beat it. "We live in a world of coopetition now, where projects and companies will cooperate, and compete elsewhere," says Analyst (and Virtualization Review columnist) Dan Kusnetzky of Kusnetzky Group.

"As OpenStack grows, it brings along an entire ecosystem," he continues. "In the end, each customer selects what they think will solve their problem. The thing that's striking is that OpenStack seems to understand that better than some platform environments. It doesn't say, `We're the only ones.'"

Sadowski agrees that its openness and modularity is a key driver behind adoption. "With OpenStack, you can combine the Lego bricks however you want. It's open source, so you can go and look at the code. The National Security Agency [NSA] uses OpenStack. The fact that they can manipulate code probably helped with their decision."

All those factors have led to the embrace of OpenStack by much of the cloud and virtualization elite. "There are major IT influencers behind it," Sadowski says. The mindset is, "If these guys are throwing money at it, maybe we should check it out."

OpenStack Defined
OpenStack positions itself as an Infrastructure-as-a-Service (IaaS) provider. The first version, Austin, had two primary parts: OpenStack Object Storage and OpenStack Compute. The latest (ninth) version, Icehouse (released April 17), includes 10 core projects:

  • Storage (Swift)
  • Compute (Nova)
  • Image Service (Glance)
  • Dashboard (Horizon)
  • Identity (Keystone)
  • Networking (Neutron)
  • Block Storage (Cinder)
  • Telemetry (Ceilometer)
  • Orchestration (Heat)
  • Database service (Trove)

The next release of OpenStack, Juno, may be available by the time you read this; it's expected to be out on Oct. 16. Because of its modular nature, OpenStack is often implemented piecemeal; organizations usually add the bits they want, and ignore the rest.

OpenStack is used predominantly for building private clouds. Although there are some public cloud use cases, they're rare at this point. Part of the hesitancy to break through that boundary is the fact that OpenStack is very complex. "With Icehouse, there are 1,200 different parameters you can configure," Sadowski says. In addition, "The readily available OpenStack developers are lacking."

Challenges in Using OpenStack
There are other reasons, too. For instance, it's not as refined as some competitors, like VMware, Amazon Web Services Inc. (AWS) and Microsoft. "OpenStack as a whole should be considered relatively immature software," Lydia Leong, VP distinguished analyst in the Technology and Service Provider group at Gartner Inc., explained in a research report. "OpenStack is, typically, used to run new workloads. Most organizations do not migrate their existing applications onto an OpenStack-based cloud."

Forrester Research Inc. Analyst Lauren Nelson agrees. OpenStack "doesn't have a lot of the advanced management features a lot of the public cloud platforms have," she says.

Because of those limitations, says Sadowski, a typical OpenStack private cloud is established for testing/development purposes. "But to grow, it needs to shed the stigma that it's not enterprise or production-grade."

The open nature of OpenStack may help with that, as "vendor lock-in" is a phrase that still sends chills down an IT administrator's spine. They're "just trying to create something interoperable that will work on any machine … If you select VMware's approach, you're tied to VMware, and with Amazon you're tied to Amazon," Kusnetzky says in describing a common admin mindset. "A lot of cloud approaches seem to have hidden shackles; vendors want these on your hands and wrists, and [they say] everything will be fine. They remember being subservient to IBM, Microsoft and so on."

One downside of that openness, though, is a lack of the proverbial "single throat to choke." An admin running Microsoft Azure knows exactly who to call if something goes wrong. With a completely open source system, that can be a lot less clear.

Another downside is the lack of readily available expertise, as OpenStack can be a nightmare to implement. In some cases, says Forrester's Nelson, it could take "years to get OpenStack up and running. Most enterprises don't have cloud experience." Hence, the large and fast-growing ecosystem of vendors happy to charge for the know-how.

VMware Joins the Club
It's an ecosystem that, until very recently, didn't include VMware, the behemoth of private clouds. "Behind almost every private cloud is vSphere," says Forrester's Nelson. "VMware is getting a lot of money from the private cloud [market] … they need to make sure they're not going to get left out [of the conversation around OpenStack]," she says.

That makes sense, because OpenStack remains almost exclusively a private cloud product. According to Nelson, "OpenStack, early on, mentioned competitors not being AWS, but VMware. VMware is its biggest target when it comes to the private cloud space."

Although that's still true, VMware has resolved to play nice with OpenStack, even to the point of contributing code to the project. Arvind Soni, senior product marketing manager at VMware, says, "We've been contributing significantly across the board for some time [to the OpenStack community]. Our goal is to leverage our customer expertise and existing investment [in OpenStack] to easily deploy and manage OpenStack as a service."

VMware marketecture describes VMware Integrated OpenStack this way: "Key cloud administrator capabilities, including install, upgrade, troubleshooting, cost-visibility, and more are provided via deep integration with already familiar VMware management tools, providing fast time to value and low total cost of ownership."

The Fear of Lock-In
That sounds nice, but what's VMware's answer to the concerns over lock-in? Chris Wolf, VMware CTO, Americas, recently joined VMware from Gartner. He put it this way in an earlier interview: "Lock-in fears are often driven by an IT services industry that wants enterprises to have complex environments so that they can sell them additional services and maintenance. I often tell VMware clients that complexity is great for profits, just not their profits. Fear over lock-in, combined with bad advice, can lead organizations to focus so much on capex savings that they are blind to significantly higher opex costs associated with integrating and operating several diverse platforms.

"Public cloud providers are highly standardized for a reason -- they achieve greater scale and reliability at lower costs. While basic math can tell anyone that fewer variables in a datacenter enables automation at lower costs, we understand that many enterprises require choice. VMware provides choice in multiple areas through our cloud management platform -- vCloud Automation Center (vCAC). vCAC allows organizations to deploy applications and services to multiple cloud providers and to multiple virtualization platforms within their datacenters. On vCAC, our vSphere platform is just one supported platform of many."

Not Ready for Prime Time?
And now, VMware has added OpenStack to that list. But VMware continues to dominate the private cloud space, and maintains several advantages over OpenStack. "VMware had a bigger head start. Its technology is much more bulletproof," says 451 Research's Sadowski.

In addition, he adds, "[Companies have] concerns with OpenStack's upgrade process. Every six months, there's a new release." Another OpenStack weakness, Nelson says, is that some components are less mature, and companies may be waiting for more refinements.

It's those kinds of issues that lead Gartner's Leong to write, "OpenStack is, typically, used to run new workloads. Most organizations do not migrate their existing applications onto an OpenStack-based cloud."

The companies that run OpenStack in large-scale production environments have similar large-scale resources to build and manage it, Leong states. "Most organizations that currently use OpenStack are very comfortable adopting early-stage technologies, have very strong engineering capabilities and the willingness to invest substantial resources into OpenStack (including, potentially, obtaining managed or professional services), and are using OpenStack in scenarios where they are willing to tolerate risk in order to gain ability."

Despite these limitations, OpenStack continues to grow at an amazingly fast rate. It's rare for a week to go by without another vendor announcing some type of OpenStack integration. Similar competitors, like CloudStack, have faded into the background and essentially dropped off the radar. For an open source-based private cloud platform, the choices are similar to what Henry Ford is alleged to have said about colors for his Model T: "You can paint it any color, so long as it's black." You can have any free private cloud platform, as long as it's OpenStack.

Where to from Here?
Given its momentum, how big can OpenStack grow? Is it destined to be a niche player, a strong choice for private cloud, but not a serious competitor for public cloud usage? Predictions vary. Kusnetzky says that OpenStack can work as an enterprise-class infrastructure, "But you have to be careful to select the elements that fit the mission you want. My sense is it will continue to grow because there will continue to be an interest in it."

Forrester's Nelson says that although she's not ready to call OpenStack a game changer, "it sure is a piece" of the overall puzzle.

"Given OpenStack's current development trajectory, Gartner does not believe that it will become the standard in the cloud industry," reports Gartner's Leong. "We do believe, however, that it will eventually mature into a solid open source core at the heart of multiple commercial products and services."

Sadowski sees a bright future for OpenStack. "I think it has a real good chance of being successful as a private cloud platform; whether it supplants somebody like AWS for public clouds -- that's a lot bigger mountain to climb. But it could become de facto for private clouds."

In addition, as Nelson notes, neither private nor public clouds have captured huge market share yet. Her figures estimate 33 percent adoption of private clouds by companies, and just 13 percent for public clouds. Because of that, there may be room for multiple products, including OpenStack, at or near the top. As Kusnetzky says, "I'm not sure you can say there will be a single winner. OpenStack's approach is to make the pie bigger so everybody can have a piece."


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