Red Hat continues to make good progress in this year’s Magic Quadrant, primarily due to a strong tie between KVM adoption and OpenStack and an increase in OpenStack adoption and integration. In Red Hat Enterprise Virtualization (RHEV) 3.5 (February 2015), Red Hat added both the OpenStack Glance project (for disk and server image management) to its distribution and a technology preview of OpenStack’s Neutron networking project. But OpenStack is not necessarily a sure thing for Red Hat. The OS of choice appears to be Ubuntu, and RHEV appears to be the hypervisor of choice about 5% of the time. As Gartner has pointed out in the past, RHEV’s primary competitor still appears to be open-source KVM. With a relatively undervirtualized Red Hat Enterprise Linux (RHEL) market, and a growth in OpenStack, Red Hat has potential opportunity.
As a stand-alone offering, Red Hat offers RHEV 3.5 — including Hypervisor and Manager — for virtualized enterprise workloads for supported guest operating systems. Red Hat Enterprise Linux with Smart Virtualization is aimed at customers looking to maximize the benefits of their virtualized infrastructure with Linux workloads and Red Hat Cloud Infrastructure, a comprehensive solution that supports organizations on their journey from traditional data center virtualization to OpenStack-powered clouds.
Red Hat’s virtualization strategy should be to first become the No. 3 virtualization vendor behind VMware and Microsoft, especially in the RHEL installed base and where there is concern over VMware lock-in. It should also align tightly with growing interest in OpenStack, especially for private clouds, and build a rich set of layered software capabilities, including JBoss Middleware, CloudForms and OpenShift. Red Hat’s vision makes sense. The key will be execution at the same time that VMware and Microsoft are investing heavily in their own solutions that extend from virtualization to cloud infrastructures, IaaS and platform as a service (PaaS).
Similar to Microsoft, Red Hat’s success cannot require displacing VMware or only penetrating customers that have yet to virtualize. Instead, Red Hat needs to successfully promote the idea of the right virtualization stack for the right applications, promote RHEV or Linux Containers (LXC) — especially for Linux-based development and new applications managed on LXC — and allow VMware to maintain a position for existing enterprise applications. RHEL customers remain a prime target. Microsoft is promoting the same idea with its Hyper-V, but it is almost exclusively gaining share in Microsoft-only environments — leaving Linux an opportunity for Red Hat. For private clouds, while VMware will take a strong position, Red Hat can promote an alternative: OpenStack-based private cloud architecture for new, cloud-aware applications and new development/test. Red Hat’s biggest competitor will be open-source-based solutions, but as interest in OpenStack grows, interest in vendor support and more turnkey solutions will also grow. Improved investments in marketing will be critical for Red Hat to overcome significant marketing by VMware and Microsoft.
Enterprises interested in OpenStack but looking for faster time to value should consider Red Hat as an option — but also should require a rapid return on investment (two to three years), with the potential of changing technologies at the end of that time frame.
- Red Hat has a strong and loyal RHEL customer base opportunity (much of which can virtualize using hypervisors or containers).
- Red Hat with CloudForms has a solid offering for enterprises interested in OpenStack, and extends to middleware, management and PaaS.
- Red Hat leads the core KVM OSS development community
- Red Hat has achieved limited sales and marketing execution to date, while most competitors are gaining. The company must leverage its RHEL business more aggressively to generate RHEV push.
- The majority of Red Hat’s virtualized RHEL instances run on VMware, and VMware is difficult to displace.