HP Makes $1 Billion Bet on ……

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HP Makes $1 Billion Bet on Open Cloud
By QUENTIN HARDY   

Hewlett-Packard is making its big bet on cloud computing, with a significant change of its own products and business, and the biggest endorsement yet of an open source alternative to the systems of Amazon and Google.

Under the name HP Helion, HP will spend $1 billion over the next two years on products and services around OpenStack, as the open source cloud software is known. Besides offering its own free version of OpenStack, HP is putting all of its existing cloud offerings like workload management and software development under the Helion brand. HP will also indemnify its customers against any third-party patent claims that may arise against the open source software, and will extend that protection to the customers of their customers.

The idea is encourage companies to build their own private cloud systems, instead of migrating corporate computing wholesale to Amazon Web Services, Google Compute Engine, or any of the other so-called “public clouds,” which offer software and computing power on a rental basis from their giant operations. HP has its own modest public cloud business, but previously has relied on selling management software, computer servers and other hardware to corporate data centers.

“This changes how we think about who we are competing with,” said Bill Hilf, vice president of cloud product and service management at HP. “You don’t sell a box against AWS. You sell an outcome. I don’t think about Dell at all as a competitor.” HP’s public cloud, currently in two of the company’s 80 data centers worldwide, will be in 20 of them within a year, he said.

Of course, it’s not all free software and love out of Palo Alto, HP’s home. HP will offer a commercial version of Helion OpenStack in June, which will probably have the stuff big companies and telecommunications providers need to run a private cloud. With pricing, details about the guarantees and the developer model will probably be much better understood. The $1 billion, moreover, is from existing funds, and not a new drain on HP’s recently repaired balance sheet.

But even for a week rich in older companies moving to more advanced technologies, HP is making a big move. Particularly so, when coupled with last week’s announcement of a joint venture between HP and Foxconn to sell cloud-optimized servers to providers of communications services, like telecommunications companies and Internet Service Providers.

“We want to offer something that is very tested, with 24-hour support, a global footprint, and the ability for a service provider to deploy 5,000 to 10,000 computing nodes at a time,” said Mr. Hilf. “We’re trying to leverage the weight of HP.”

Size and weight usually affect speed, of course, and it’s reasonable to wonder how this cloud proposition will go down inside HP’s complex ranks. Mr. Hilf, who worked at the Microsoft Azure cloud before joining HP last year, said that when he came on there were at least five different definitions of cloud within HP. But Helion, he said, “will force a lot of people to rethink what we do.”

It is a similar change to what is happening at Microsoft, where Satya Nadella, formerly the head of the company’s Azure cloud product, is trying to bring Microsoft into the world of cloud and mobile. The two technologies together, however, are really a way of saying “computing everywhere,” and for both HP and Microsoft it will be a big challenge to sell outcomes instead of products, to individuals instead of technology departments.

Those points could also be made against Oracle, SAP, EMC and VMware, all of which have made their own cloud-based strategic announcements in recent days. You could also give them credit, however: To survive on a new world, the first thing to do is admit that you’re in it.

HP Makes $1 Billion Bet on Open Cloud
By QUENTIN HARDY   

Hewlett-Packard is making its big bet on cloud computing, with a significant change of its own products and business, and the biggest endorsement yet of an open source alternative to the systems of Amazon and Google.

Under the name HP Helion, HP will spend $1 billion over the next two years on products and services around OpenStack, as the open source cloud software is known. Besides offering its own free version of OpenStack, HP is putting all of its existing cloud offerings like workload management and software development under the Helion brand. HP will also indemnify its customers against any third-party patent claims that may arise against the open source software, and will extend that protection to the customers of their customers.

The idea is encourage companies to build their own private cloud systems, instead of migrating corporate computing wholesale to Amazon Web Services, Google Compute Engine, or any of the other so-called “public clouds,” which offer software and computing power on a rental basis from their giant operations. HP has its own modest public cloud business, but previously has relied on selling management software, computer servers and other hardware to corporate data centers.

“This changes how we think about who we are competing with,” said Bill Hilf, vice president of cloud product and service management at HP. “You don’t sell a box against AWS. You sell an outcome. I don’t think about Dell at all as a competitor.” HP’s public cloud, currently in two of the company’s 80 data centers worldwide, will be in 20 of them within a year, he said.

Of course, it’s not all free software and love out of Palo Alto, HP’s home. HP will offer a commercial version of Helion OpenStack in June, which will probably have the stuff big companies and telecommunications providers need to run a private cloud. With pricing, details about the guarantees and the developer model will probably be much better understood. The $1 billion, moreover, is from existing funds, and not a new drain on HP’s recently repaired balance sheet.

But even for a week rich in older companies moving to more advanced technologies, HP is making a big move. Particularly so, when coupled with last week’s announcement of a joint venture between HP and Foxconn to sell cloud-optimized servers to providers of communications services, like telecommunications companies and Internet Service Providers.

“We want to offer something that is very tested, with 24-hour support, a global footprint, and the ability for a service provider to deploy 5,000 to 10,000 computing nodes at a time,” said Mr. Hilf. “We’re trying to leverage the weight of HP.”

Size and weight usually affect speed, of course, and it’s reasonable to wonder how this cloud proposition will go down inside HP’s complex ranks. Mr. Hilf, who worked at the Microsoft Azure cloud before joining HP last year, said that when he came on there were at least five different definitions of cloud within HP. But Helion, he said, “will force a lot of people to rethink what we do.”

It is a similar change to what is happening at Microsoft, where Satya Nadella, formerly the head of the company’s Azure cloud product, is trying to bring Microsoft into the world of cloud and mobile. The two technologies together, however, are really a way of saying “computing everywhere,” and for both HP and Microsoft it will be a big challenge to sell outcomes instead of products, to individuals instead of technology departments.

Those points could also be made against Oracle, SAP, EMC and VMware, all of which have made their own cloud-based strategic announcements in recent days. You could also give them credit, however: To survive on a new world, the first thing to do is admit that you’re in it.

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May 8, 2014 at 11:59 AM