Yesterday I read the news about EMC buying Cloudscaling, a small startup working on an Openstack distribution primarily focused on enterprise clouds. LOGOOne of the most interesting characteristics of Cloudscaling Open Cloud System is its compatibility with AWS and GCP which should help its customers to build hybrid cloud implementations.
Looking at various websites, it’s interesting to note that many of them have reported the news but the comments are still very few. Scarcity of information from EMC and Cloudscaling certainly doesn’t help. But let’s try to figure out why EMC is doing this.

The market wants hybrid (and Openstack is LAGGING BEHIND)

GMO AppleorangeThis is not news anymore. The preferred model for most organization types is hybrid. Even if you are planning for a 100% private (or 100% public) cloud, you keep your eye on platforms capable of moving your workloads between on-premises and public infrastructures. Sometimes it’s not because you need it today, but because it is about lock-ins and freedom of choice in the future.

Openstack proposes to be the AWS alternative for private clouds but, at the same time, it doesn’t guarantee interoperability between different distributions and providers. This is a big issue and organizations that want cloud interoperability are beginning to wonder about this limit. From this point of view, Cloudscaling has addressed the problem at its very root, trying to push heavily on interoperability.

Although I have to say that this is probably only a maturity problem (the discussion about AWS compatibility in the Openstack community is hot and and some Openstack projects are aimed at providing EC2/S3 compatibility) it’s clear that managing different clouds at the same time is more complex than having some sort of API compatibility… and Openstack is still lagging behind on that issue.

Consolidation is happening

iStock_000012910535SmallThe EMC move follows a similar one made by HP. HP will probably integrate the Eucalyptus product, an AWS compatible CMP, and competence in its Openstack-based products soon. Also Cisco, that wants to become a one-stop shop for its customers and stay as relevant as possibile in the software-defined era, has recently acquired one of these Openstack startups (Metacloud). Not to mention Dell, which bought Enstratius (another multi-cloud management platform) earlier this year!

In any case, big players are out buying cloud startups. But, from my point of view, if you look at the type of acquisitions it seems that big vendors are acquiring competence more than products. In fact, most of the acquired startups are very small and they have been purchased at low prices. (most of them are not public but it’s presumed that we’re talking about transactions under $100M)

And what about VMware?

EMC has a big stake in VMware which, BTW, is already working on its OpenStack distribution. From this perspective it looks like EMC is going to compete with one of its own companies! And VMware has a multi-cloud management platform too.
Logo-openstackEven though the news about split ups, sales and whatever are still recent… It’s hard to understand why EMC would buy a cloud management platform. On the other hand, if the acquisition is all about acquiring talents this radically changes the perspective about the acquisition and makes much more sense.
I’ve recently expressed my POV about the future of EMC, but these kinds of acquisitions could contribute in changing the course of this battleship and maintain its leadership position.. and eventually, even VMware might benefit from the acquisition of Cloudscaling.

Why it is important

EMC, along with others, is in the market to buy cloud startups. Considering that many of these startups are very small (and with very few customers), primary vendors’ objective is to acquire “cloud talents”. It’s not a bad strategy after all, and it will surely contribute to improving their presence and importance in the cloud world. In the middle term, and if these talents are involved in the development process, we can also expect to see more cloud-savvy products…

Consolidation is always a sign of maturity and it will also help primary cloud vendors.