Cisco's Piston acquisition shows the plight of OpenStack indies

In the current OpenStack market, a buyout by a major player may be the best possible fate for indie outfits

Piston Cloud, one of the major indie OpenStack vendors, is now a Cisco company, according to blog posts by both Cisco and Piston.

It's another sign of rougher competition in the OpenStack space. Furthermore, it's a broad hint regarding the challenge faced by independent vendors of open source private-cloud solutions: To be acquired by one of the bigwigs that make up OpenStack's inner circle of corporate developers.

Ripe for the picking

Cisco plans to bring Piston into its Cloud Services team and to use the expertise at Piston to further build out Cisco's OpenStack work, mainly Cisco OpenStack Private Cloud and the company's ongoing Intercloud effort.

Piston has a lot to offer Cisco apart from OpenStack alone. Piston recently launched the 4.0 version of its CloudOS item -- a top-to-bottom solution for OpenStack, containers, and bare metal alike.

This isn't the first time Cisco has picked up an OpenStack company. Back in September 2014, the networking giant acquired Metacloud, provider of an OpenStack-as-a-service offering similar to Mirantis' OpenStack Express, but far more upscale and bespoke. (Cisco plans to use Metacloud's established services as a way to further build out Intercloud.)

In a similar move, IBM -- whose investment in OpenStack is beyond question -- has picked up OpenStack solution provider Blue Box to "help businesses rapidly integrate their cloud-based applications and on-premises systems into OpenStack-based managed cloud."

The shrinking circle

The gloomy truth of OpenStack is that the size of the market, and the inclinations of the customers for it, might not allow for many vendors. To that end, having one of the biggest corporate supporters snap up an indie OpenStack player may be one of the few fates available to the remaining stand-alone outfits.

Ben Kepes at Forbes took a look at the Piston Cloud acquisition and saw it as further evidence of the OpenStack market consolidating into a few key players, with the customers that don't choose them either rolling their own or going to a service provider.

"The largest companies," Ben wrote, "are building their own OpenStack deployments on their own [e.g., Walmart].... The service providers seem to be either doing their own thing or going to the larger distros or service providers. This leaves companies like Piston (and, before, Cloudscaling, Metacloud, and Eucalyptus) to fight over all the scraps." A few manage to make it on their own, such as Mirantis, but that company is one of the exceptions, not only because of its product, but because it entered the market when it was still nascent and build a solid base there.

Those that can't put up a fight, whether due to having entered too late or having the wrong business model, will simply go under. Case in point: OpenStack casualty Nebula. Being founded by one of OpenStack's own originators didn't help; neither did offering a hardware-appliance-oriented solution for a product that was supposed to be about using commodity hardware. For Piston to end up with Cisco makes it one of the luckier ones in this space.

Copyright © 2015 IDG Communications, Inc.

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