"The unique thing about us is we provide only open source software solutions to businesses from the Linux operating system to middleware to OpenStack, where the source code is all open and free. You could say it's a neat trick to sell $2 billion of something that's technically free," says Red Hat CEO Jim Whitehurst... "I had everyone from college presidents to media company CEOs wanting to talk to me about building a viable business model when the content (in this case code) is free. We're a great example of how you actually can build a real business model. You just have to deconstruct what are the components of the value chain and recognize that you're not selling content, you have to sell something else such as platforms or services that make the free content more valuable."
Every vendor sees the open source realities that are emerging. In fact, many vendors with proprietary technologies---VMware, Microsoft, EMC, Cisco and IBM to name just a few---are embracing open source in some form. These companies are taking open source technology and wrapping their tools around it. Some vendors such as IBM have more credibility in the open source community than others, but the general theme is the same. If a vendor wants to entice you to buy its software, hardware and services there has to be open source in there somewhere... Red Hat's history in open source is giving it an edge and positioning it to be more strategic in the enterprise. Credit Suisse analyst Sitikantha Panigrahi said in a research note: "We believe that the continued momentum of Red Hat Enterprise Linux, coupled with growing adoption of open source in enterprises, has enabled Red Hat to increasingly upsell its emerging products."
Charlie Reisinger, IT director for the Penn Manor school district, helped bring an open educational model and a 1:1 laptop program to Penn Manor High School. Follow Charlie as he shows how an open philosophy and a collaborative team of teachers, administrators and students leave traditional educational models behind in favor of a future of open possibilities.
Red Hat continues to make inroads into the enterprise storage software market, improving two of its core storage technologies and striking partnerships with key IT system resellers... The company has updated both its Ceph and Gluster storage system software... Gluster can be used for setting up storage clusters to hold large amounts of data, such as log files for big data analysis. Casio and Intuit both use Gluster. Ceph, on the other hand, is ideal for cloud workloads, particularly those that need object-based storage. It is frequently paired with OpenStack cloud deployments. Yahoo uses Ceph to store for its Flickr photo sharing system. Because Ceph is open source, Yahoo was able to tweak the software to work more efficiently for its own case load... Red Hat struck a few deals with other IT service providers to expand the potential customer base for its storage software. About 60 percent of commercial Ceph or Gluster sales are done by Red Hat itself, but the rest are executed by partners.
Before moving to the cloud, enterprises face a long to-do list of technical tasks, ranging from application redesign to defining security requirements. The biggest challenge with a cloud computing project, however, lies not with the technology itself, but in the massive cultural shift it requires of an organization... Meanwhile, [the cloud's] self-service model, coupled with the business process automation that comes with cloud, creates another cultural hurdle within the enterprise: assuring engineers that cloud isn't putting them out of a job... Enterprises must emphasize that cloud's automation will allow engineers to perform other, higher-value tasks for the business... David Sundqvist, infrastructure architect at Volvo IT, said "We are getting people on board and buying into the option to provide a higher level of value." For example, instead of installing an operating system, engineers can spend time designing customer-specific configurations. "It's not going to be less work, but it's going to be a lot more value in what they deliver."