Red Hat State of the Union

At the end of every year, I find it beneficial to reflect on the accomplishments of the past 12 months, and to look forward to what the new year may bring. At the end of 2012, I can proudly state that the state of the union at Red Hat is strong.

We have an all star customer list that features 80 percent of the global Fortune 500. We have rock solid, stable growth. We’ve made significant investments to expand our capabilities, and as a result we’ve experienced a transformative shift with our solutions by moving higher up in the stack and, closer to the business. Over the last decade, we saw mainstream adoption of Linux, and now, we’re experiencing the same for open source middleware, virtualization, and storage. Open source is no longer a question mark in the enterprise. Today, the use of open source in mission critical, enterprise deployments is pervasive.

All of these things have helped establish Red Hat as an enterprise leader. This is an honor we share with the open source community and our partners – both of which play a large role in the success of Red Hat.

2012, specifically, was another prosperous year for Red Hat, with many significant milestones. We became the industry’s first pure-play, open source company, and one of only a select few software companies to have achieved the billion dollar milestone. Forbes honored us as the fourth most innovative company in the world. We expanded our portfolio of technologies with acquisitions from FuseSource and Polymita, and most recently, we announced that we have entered into a definitive agreement to acquire ManageIQ, a leading provider of enterprise cloud management and automation solutions. We continued to expand our partner ecosystem, and deepened relationships with existing partners. We hosted a record number of attendees at Red Hat Summit, and celebrated customer innovation. We launched a wide range of new solutions across our portfolio, from Red Hat Enterprise Virtualization3.1, Red Hat Storage 2.0, and Red Hat CloudForms to JBoss Enterprise Application Platform 6.0, JBoss Data Grid 6, OpenShift Enterprise, and enhancements in Red Hat Enterprise Linux. We added jobs and built new facilities around the globe to support our growth.

Looking ahead to 2013, our potential is massive. Around the globe, organizations will continue to embrace community-powered innovation, seeing opportunity in the open source development model. From the operating system and virtualization to the application server, service-oriented architecture (SOA), business process management (BPM), storage, IaaS based on OpenStack – Red Hat and our partners have an opportunity to truly change enterprise technology by delivering disruptive technology with incredible economics.

The move to cloud computing represents a significant paradigm shift -a re-centralization of compute into large, managed data centers and the explosion of end point devices, from mobile phones to sensors and beyond. And while some may feel like we’ve been talking about cloud computing and its potential for ages, we’re still in the early stages. In paradigm shifts such as this, historically, the early winners emerge as the long term winners. In the near and long term, open hybrid cloud will be the winner.

But the implications go far beyond the technology opportunities presented by cloud. I hear it and see it across industries and around the globe; instilling the capacity to innovate is a top of mind priority for executives. Business is changing much more rapidly than in the past. Traditional top-down strategy and planning are no longer fast enough to keep pace with accelerating change. Companies that build the capacity to recognize change and react quickly to it will be best positioned to win in the new environment unfolding. And, as technology causes "transactions costs" to implode, it speeds the rate of innovation. This will be great for the new innovators, but challenging for incumbents.

At a business level, technology is also enabling new ways of organizing and managing. Traditional hierarchies were developed to overcome information constraints. Now, because technology allows for rich and instantaneous information flows, new and more collaborative organizational structures can emerge. With collaboration and meritocracy at the heart of everything we stand for, Red Hat and the broader open source community are in a prime position to excel.

Myriad industry analysts tell us that enterprise is looking for openness and choice.  Open source is therefore well positioned to win in cloud and big data, and if this happens, the open source community along with Red Hat, our partners and customers will ultimately benefit. While I know there will be many obstacles as enterprises transition to next-generation IT and architecture, I’m excited about the opportunities facing Red Hat in 2013. Together, with our partners, customers and the open source community, we can play a pivotal role in shaping this next great shift in IT.

Here’s to a great 2013 and beyond.