Red Hat Sees Strong Demand For Cloud Computing

As many as 50 of its customers have begun building private compute clouds using Red Hat Linux, says Red Hat CEO Jim Whitehurst. A few are investigating "semi-private clouds," in which they plan to share IT resources with trusted partners.Speaking at the recent Federal IT on a Budget Forum in Washington, Whitehurst said Red Hat sees a "a ton of demand" for private, semi-private, and public clouds. As an operating system and middleware provider, Red Hat doesn't have a bias toward private or public clouds; both are business opportunities for Red Hat.

Whitehurst anticipates the market splitting up roughly along the following lines: small and medium-sized companies subscribing to public clouds and large companies building their own. He says large companies (say, those with 1,000-plus servers) get close to the same economies of scale as public cloud service providers when it comes to purchasing gear, so the cost benefits of moving to the public cloud aren't as compelling. "There's going to be some difference in costs, but not much because the margins aren't that big," he said in an interview following his keynote.

The other rationale for do-it-yourself clouds versus services like Amazon's Elastic Compute Cloud is the lower risk, or perceived lower risk, around data security. A few Red Hat customers have begun to investigate the feasibility of creating semi-private clouds where they would share IT infrastructure for cloud bursting or other demand peaks with partners that have been vetted in advance. Red Hat is helping its customers identify potential partners for these semi-private clouds.

One issue to be resolved with semi-private clouds is whether partners should be in the industry, say financial services, or different industries. On the one hand, financial firms might find it easier to set up a cloud with companies they already know and do business with. On the other hand, their IT usage patterns might be too similar to warrant a shared environment, with the risk of simultaneous demand spikes. "This is one of the big debates," Whitehurst says.

Red Hat has no plans to offer cloud services itself. "We're not getting in the cloud business. We're not competing with our customers," says Whitehurst.