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Eucalyptus CEO Plays On VMware Lock-In Fears

May 25, 2012 (05:05 AM EDT)

Read the Original Article at http://www.informationweek.com/news/showArticle.jhtml?articleID=240001033


Eucalyptus Systems CEO Marten Mickos says his company's cloud product line is in a strong position for the build-out of private clouds, but it must succeed at being a viable cloud supplier alterative to VMware.

Eucalyptus Cloud is based on downloadable open source code, and the firm sells technical support for its code. It provides an alternative to what Mickos sees as VMware's "lock-in" of the growing list of virtualization products that have become dominant in the data center virtualization space. The strength of VMware's product line gives the firm a springboard to become the primary supplier of cloud software for inside the enterprise, Mickos acknowledged.

Eucalyptus has often been criticized for too narrow an approach to the market. It made its software specifically compatible with Amazon Web Services. Less well noted has been its ability to make Eucalyptus Cloud work with multiple hypervisors. As an experienced Finnish businessman who took over Swedish company MySQL AB, Mickos knows a few things about business fears of vendor lock-in.

"We are not trying to displace VMware in the enterprise. We are trying to give VMware customers leverage. They can use Eucalyptus to tell VMware, 'We may expand our use of KVM,' or other non-VMware hypervisors," if they adopt the Eucalyptus approach to private cloud, Mickos said Tuesday in an interview during the Open Source Business Conference in San Francisco.

VMware tends to see cloud computing as a feature added on top of virtualization, he claimed. "We disagree. We think it is a disruptive technology of its own and should be designed from the start as its own system, not as an add-in."

[ Want to learn more about how Eucalyptus rival Nebula got its start? See NASA's Former CTO Brings Cloud Appliance To Enterprise. ]

VMware representatives say on-premises cloud computing is a natural extension of the already-virtualized vSphere part of the data center. VMware cloud products are closely integrated with VMware virtualization products, an argument that Mickos is trying to counter.

He said VMware's existing presence in the data center makes it a contender to become an on-premises cloud software supplier. Furthermore, he acknowledged VMware's leadership was proving effective at the helm. "Paul Maritz is a brilliant CEO, but he still needs somebody to keep up the competitive pressure, to keep him honest," he said.

Mickos then listed reasons why Eucalyptus Cloud avoids lock-in:

-- It is a cross-hypervisor company, giving customers a way to use a variety of virtualization vendors as well as VMware's ESX Server. "There will be a commoditization of the hypervisor. Ultimately it will be a feature of the hardware," he said, which means the ability to manage multiple hypervisors will be a way for IT to maintain its own set of choices.

-- Eucalyptus has already tackled one of the tough problems of cloud computing, adding the characteristic of high availability in its Eucalyptus Cloud release 3.0 last August.

-- Eucalyptus allows companies to build out an on-premises cloud with APIs that are compatible with Amazon Web Services. Eucalyptus has been criticized for betting too much of its future on early compatibility with Amazon as a key private cloud characteristic. Mickos said that bet still stands and it looks good to him.

-- Eucalyptus, from the start, bet on the growth of private cloud inside the enterprise and ignored the service provider market. OpenStack and CloudStack, on the other hand, started out as service provider systems and, secondarily, private cloud systems, he said. Furthermore, OpenStack "is a set of projects, not a product, that the customer must customize to make work," he claimed. OpenStack vendors, such as Chris Kemp's Nebula or Joshua McKenty's Piston would disagree.

MySQL at one time was primarily a developer system, not a finished product, a point that Mickos, as former CEO of MySQL AB, is well aware. But MySQL AB packaged it up to become a frequently downloaded system. The same may ultimately happen with OpenStack. Mickos said there's no need to wait: Eucalyptus is a tested, packaged set of services today.

Mickos also stressed that Eucalyptus is also the only private cloud vendor with an Amazon guarantee of compatibility with Amazon EC2 and S3. That means a storage service built on premises with Eucalyptus can shift to storage in the public cloud without any programming required. Does that matter to anyone?

"The first thing I did when I joined Eucalyptus (two years ago) was give Amazon a call," recalled Mickos. Since then, other staffers have been involved in negotiations that bore fruit March 22 with a partnership announcement. On April 18, a group of investors announced $30 million in additional funding for Eucalyptus, bringing its total funding to $60 million. The move was lead by Institutional Venture Partners and included previous investors Benchmark Capital, BV Capital, and New Enterprise Associates.

The private cloud is still an idea or, at most, a planned future build-out, in many places. In some cases, implementation is well underway. Where Eucalyptus has made a sale, the average deal is $120,000, or 10 times the size of the average MySQL deal, said Mickos.

It's been a slow start, but over the next five years, Mickos expects to see on-premises cloud computing "become the defining technology of the data center." When it does, Eucalyptus, with those sometimes controversial choices for its business strategy, will be well positioned to be "the most compelling alternative to VMware," he said.

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