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OpenStack Cloud Vendor Nebula Shuts Down

The company was founded by a former NASA CTO.

Unfortunately, it was no April Fools' joke. On April 1, cloud vendor Nebula, which focused its business around OpenStack, announced that it was shutting down.

Nebula blamed its demise on the immaturity of the market surrounding OpenStack, an open source cloud platform that's primarily used for private clouds. "… we are deeply disappointed that the market will likely take another several years to mature. As a venture-backed startup, we did not have the resources to wait," an announcement on the Nebula homepage stated.

Burning Cash
Nebula had secured $38.5 million in venture capital funding, according to former employee Matt Weinberger, who wrote in Business Insider that he worked for Nebula for about a year and a half. "The Nebula product took two years to develop, with the team trying to get it just exactly right, and was reticent to talk about the work in the meanwhile. While that work was going on, the team was burning cash," he said.

In the end, it wasn't enough. "… we have worked hard to explore alternatives and exhausted all potential options," the company said.

The statement explained that Nebula clouds at customer sites will still work, but won't be supported. The company suggested that those customers look to vendors like Red Hat Inc., IBM Corp. and Hewlett-Packard Co. for continuing support.

The NASA Connection
Nebula had a lot going for it when it started operations. Its founder was Chris Kemp, a former CTO for NASA. NASA itself was a co-founder of OpenStack, along with Rackspace. In 2012, NASA moved away from OpenStack and toward Amazon Web Services, at a savings of about $1 million per year.

Nebula officially opened its doors in 2011. Other high-powered executives on board at that time included Jon Mittelhauser, a co-inventor of the first Web browser -- NCSA Mosaic for Windows -- and Devin Carlen, who worked with Kemp at NASA.

Weinberger wrote that Nebula had a strong start, but couldn't sustain its momentum. "… sales were slow to follow. People didn't really understand what Nebula was trying to sell, and many chose instead to go with competitors they understood."

OpenStack Growth
OpenStack pools resources like compute, storage and networking, offering management through a dashboard and application programming interface (API). It releases updates every six months. The last, Juno, came out in October 2014. The next one, Kilo, will be out sometime this month. OpenStack has many vendors supporting it, and a robust developer community and ecosystem; but it's still viewed as difficult and complicated for companies to dive into without significant expertise.

Nebula is the second notable vendor in the cloud/virtualization space to go under in the past week. Last Friday, enterprise mobility management company Moka5 apparently ceased operations. In its case, however, Moka5 didn't announce anything to anyone; in fact, its Web site could still fool current and potential customers into thinking it's fully operational.

About the Author

Keith Ward is the editor in chief of Virtualization & Cloud Review. Follow him on Twitter @VirtReviewKeith.

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