Taking the FUD out of private cloud and OpenStack

Even though it’s been around since 2000, with technology like OpenStack, there’s a lot of hype (and fear, uncertainty, and doubt–or FUD) to weed through. Is OpenStack being used in production? Is public cloud the new cloud?

Margaret Dawson, head of global product marketing at Red Hat, started her Building a private cloud with OpenStack Summit session saying she would arm us with “ways to combat the hype in the marketing, ways to justify why you want to use OpenStack, and real-world examples of OpenStack deployments.”

What is OpenStack?

A modular, open-source software platform for cloud computing with components that manage resources or compute, networking, and storage. In IT parlance, it’s private cloud, or Infrastructure-as-a-Service (IaaS).

Why should you care?

  • Private cloud computing is the #1 major IT initiative planned for completion in 2016 by Red Hat customers
  • OpenStack is the leading private cloud technology (40% of Red Hat customers polled plan on launching OpenStack POC or production deployment)

Why does OpenStack matter?

Because the #1 major IT initiative for Red Hat customers in 2016 is private cloud computing. And the number is rising.

Margaret Dawson
Margaret Dawson is a senior product marketer at Red Hat, overseeing the company’s integrated solutions business unit. @seattledawson

Dawson presented with 2 companies who have deployed OpenStack in production: Soumen Saha, IT Transformation Director at CapGemini, and Richard Haigh, Head of Delivery Enablement, Paddy Power Betfair. They talked about the perceived (and sometimes real) complexity related to OpenStack, and getting a private cloud into production. (Dawson said Red Hat is simplifying by ensuring our own OpenStack related products like Red Hat Cloud Infrastructure, Red Hat Cloud Suite, management products like Red Hat CloudForms, and Red Hat Ceph Storage have common installation and configuration templates. Red Hat is also making these products more interoperable with non-Red Hat products.)

Now for the FUD, with real-life examples from Paddy Power Betfair and CapGemini.

FUD #1: Public cloud has already won

It’s early days. In fact, Dawson cited Gartner research that suggests that approximately 25% of enterprise IT leaders don’t yet have a clear cloud strategy. And it’s a hybrid world.

FUD #2: Building infrastructure is futile (public cloud providers can undercut costs)

Soumen Saha
Soumen Saha is the IT transformation director for Capgemini. @somucal

Cost cutting is a real IT concern, but not at the expense of security and compliance. (It’s Red Hat customers’ #2 IT concern, according to a 2016 Red Hat Customer predictions survey.) “Enterprises want critical workloads in privately controlled infrastructure,” Dawson said.

REAL-LIFE EXAMPLE #1: Paddy Power Betfair

The world’s largest betting exchange and largest publicly traded gambling company, Paddy Power Betfair handles 135 million transactions per day–20x the daily transactions conducted on the New York Stock Exchange, according to Richard Haigh, Head of Delivery Enablement.

Business needs for private cloud

  • Didn’t want to wait 2 weeks for provisioning–rather, wanted it as the speed of code (minutes and hours).
  • Wanted to give developers control and automate everything
  • Wanted to extend continuous deliver into the infrastructure layer
Richard Haigh
Richard Haigh is head of delivery enablement at Paddy Power Betfair.


  • Resilient data centers
  • Software-defined network
  • Central storage
  • Commodity compute
  • Virtual and bare metal
  • Rich APIs for automation
  • Scale for future growth
  • Compliant>

The group took a 4-step approach to launching their private cloud

  1. Proof of concept – Conducted 4 weeks of performance testing.
  2. Pilot – Tested the software in 2 datacenters. Built the seeds of what would be the final project, and made sure legacy systems could “talk” to the pilot systems.
  3. Onboarding – The team helped employees get used to a new way of working. Also, developers are now considering virtualization. “It’s as easy as AWS, but it happens to be ours,” Haigh said.
  4. Decommissioning – Team is cleaning up legacy systems and making space for new implementations.

FUD #3: Containers make OpenStack obsolete

Do I even need OpenStack now that we have containers? Can’t I just use Openshift and containers? Dawson says to consider the type of workloads you plan to run. “Depending on what you’re doing, standard virtualization might be okay,” Dawson said. “But OpenStack will help you scale. You may decide to go to a full Platform-as-a-Service (PaaS) on top of your virtualized infrastructure. The key is to do what works best for you based on future demands.”

FUD#4: OpenStack isn’t easy

OpenStack is not always easy, Dawson said. But it’s gotten better. There are more plug-ins with Cisco and other partners. She also said that because it’s so customizable, it can seem more complex than it really is. Red Hat is creating more scenarios and use cases so you can choose something that already exists and try it out. We are adding simplicity and taking out complexity.

FUD #5: OpenStack is not enterprise ready, and is losing steam.

Analyst firm Gartner publishes a hype cycle that describes the waxing and waning of popular topics. OpenStack could be in their “trough of disillusionment.” Dawson said there are lots of reports of AWS revenue, but OpenStack is a $2B market. She added that vendors are making significant revenue from OpenStack, and that companies should feel comfortable investing.


Every business has to plan their journey to the cloud. And Soumen Sada, Soumen Saha, IT Transformation Director at CapGemini shared a few tips.

  • Work with vendors who are used to collaborating (no lock in)
  • Be a “cloud first” organization
  • Take advantage of the 10-million-strong open source developer community Paul Cormier mentioned in his Tuesday Red Hat Summit keynote, and using technology created by this massive group of contributors.
  • Plan for scale (which, he said, OpenStack is known for)
  • Test a few projects in a sandbox before they go to production, and create a few “lighthouse” use cases

And the final FUD, #6: Red Hat doesn’t have OpenStack customers in production

Margaret Dawson said Red Hat has 350+ deployed private clouds and 40+ PoC’s are currently in progress worldwide. Examples include Target, Telefonica, Nasa, Nokia, Verizon, FedEx, Bank of America.

Red Hat is also a private cloud market leader in the 2016 Q1 Forrester Wave for private cloud software suites.

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