Accelerating transformation to open hybrid cloud with Red Hat Hybrid Committed Spend

As many organizations continue to undergo digital transformations, focusing on automation and immediate efficiencies, many choose to also make the transition to cloud, an evolution described as a “cloud first” strategy. A cloud-first strategy is an approach to IT that prioritizes cloud-based solutions over traditional on-premises infrastructure which can help businesses reduce innovation costs, improve agility and scale more easily.

Red Hat is helping customers with their digital transformations and desire for efficiencies by making our solutions available for deployment and procurement both on-premise and in the cloud.

That is why Red Hat has developed the Hybrid Committed Spend (HCS) program to assist our customers with their digital transformation efforts without the hassles of managing spend and licensing across several diverse programs.

The ability to offer both on-premise and cloud deployments of Red Hat products through the HCS program positions us to grow with our customers in this changing market. While the growth potential in the public cloud for new applications is rapidly increasing, we realize that not all workloads will move to the cloud. Our commitment to our customers is to help them use our software across platforms, while making it as easy as possible for them to procure and deploy where they want. 

What is Red Hat Hybrid Committed Spend?

Our cloud partners offer committed spend programs or contracts of their own, and the Red Hat HCS program is designed to align with and complement these programs for the benefit of our customers. Red Hat HCS allows customers to unlock additional benefits, not available in a traditional transaction model, in exchange for an upfront commitment. Red Hat’s HCS program increases customer flexibility in a few ways: 

• Flexibility and choice to purchase Red Hat products via a customer’s preferred vendor and deploy in a customer’s preferred environment
• Ability to receive volume discount considerations for total spend across channels and footprints
• Product deployment flexibility across Red Hat’s portfolio, allowing customers to shift from one product to another on a monthly (and in some cases an hourly) basis 
• Maximum procurement and financing flexibility with the option to merge traditional subscription (paid upfront) with on-demand subscriptions (billed monthly in arrears) 

Why might a customer shift to a Red Hat HCS?

Red Hat HCS is designed to accelerate several use cases as we help our customers transition to the cloud. Here are some cases in which our customers are experiencing the benefit of an HCS agreement:

• Cloud migrations: Customers migrating to cloud (often with a hyperscaler commitment) looking for subscription flexibility as they migrate
• Procurement optimization: Customers looking to optimize procurement by combining benefits between cloud spend commitments and software purchases and/or a blend of upfront and monthly in-arrears payments
• Deployment flexibility: Customers looking for more flexibility in where and when they deploy Red Hat products. HCS allows hourly, monthly, annual or 3-year product offerings

How does Red Hat HCS work with cloud providers' commitments? 

The Red Hat HCS program lets customers purchase and deploy products when and where they need them. They can draw down against their Red Hat Hybrid Committed Spend commitment regardless of whether they purchase products directly, through the channel or through a cloud provider. Under the Red Hat HCS program, a customer who deploys Red Hat software from their preferred cloud provider’s marketplace may be able to draw that purchase against their cloud provider’s commitment, as well as from their Red Hat commitment, essentially “double-dipping.”  This helps with both satisfying their commitments from their cloud provider’s agreements, ensuring that they realize their volume discounting and reducing the risk of a balance billing.  

In summary, the Red Hat HCS is designed to ease the transition for Red Hat customers to the cloud. The program efficiently and economically manages costs across both on-premise and cloud platforms, allowing our customers to bring the Red Hat solutions they rely on into the cloud. 

For additional information, please reach out to your Red Hat sales professional or your Red Hat partner.