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Dell Dumps Its Public Cloud Offerings

samzenpus posted about a year and a half ago | from the on-second-thought dept.

Cloud 56

itwbennett writes "Last week, Dell said that it would be 'refining' its OpenStack plans. Now we know that 'refining' means 'backing away from'. Although the company wouldn't answer direct questions on the subject, a press release spells it out like this: 'Sales of Dell's current in-house multi-tenant public cloud IaaS will be discontinued in the U.S. in favor of best-in-class partner offerings.' Interestingly, none of Dell's initial partners, including Joyent, ScaleMatrix and ZeroLag, have platforms built on OpenStack."

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So ... (0)

Anonymous Coward | about a year and a half ago | (#43775683)

So, does this mean the "cloud" doesn't rain money on the sevice providers?

Dell, along with most other computer companies, jumped on the cloud bandwagon long before anyone had an idea about what they were doing - let alone had a business model.

Re:So ... (2)

TheBestMerlinEver (2927797) | about a year and a half ago | (#43775989)

this is odd. given the Dell model was a huge cash cow for them.

Re:So ... (1)

gl4ss (559668) | about a year and a half ago | (#43776091)

this is odd. given the Dell model was a huge cash cow for them.

you know what's an EVEN bigger cash cow? selling the service - the cloud service - at a premium and actually buying the service from whoever happens to be selling it cheapest that week.

Re:So ... (1)

TheBestMerlinEver (2927797) | about a year and a half ago | (#43776135)

but they lose the future profits....

Re:So ... (1)

spacepimp (664856) | about a year and a half ago | (#43776055)

There are plenty of people making money offering cloud provisioning/services. This is more along the lines of: Dell accepted 2 billion dollars of cash infusion from Microsoft. Dumping open stack and not building ChromeOS or linux boxes is part of the agreement terms I suppose. Open stack has been fairly successful and the vendors who seem to be dropping support for it are to entertain ways of making more money in licensing.

Conspiracy theory 101 (3, Interesting)

spacepimp (664856) | about a year and a half ago | (#43775687)

This is what a two billion dollar cash infusion buys? They are the new Nokia apparently.

Re:Conspiracy theory 101 (2)

Anonymous Coward | about a year and a half ago | (#43776403)

Except that there is no mention of Microsoft. You'd think if there was a conspiracy by Microsoft to get Dell to drop OpenStack, you'd see Dell recommending Azure.

Dell should have declared bankruptcy (0)

Anonymous Coward | about a year and a half ago | (#43775747)

Dell was good at designing, and assembling computers, and selling them direct to customers for low cost. Unfortunately, Intel gave away reference designs, Foxconn and Walmart were better at assembling and selling computers to the American Public. Sorry Dell, but you were out competed.

Re:Dell should have declared bankruptcy (1)

Dunbal (464142) | about a year and a half ago | (#43775787)

Dell was good when they were charging IBM prices for PC's. They were innovators to some extent. I had a few early Dell machines and they were the best specs you could buy, back in the 1980's. As soon as they started competing on price, I imagine they switched to bargain basement suppliers. Now everyone knows that to own a Dell is to have to buy a new machine the very second the warranty expires if not sooner, AND having to deal with perhaps the worst support and service in the industry. But Michael Dell made his money long ago, I'm sure he's not too worried either way. It's the shareholders' problem now.

Re:Dell should have declared bankruptcy (1)

Anonymous Coward | about a year and a half ago | (#43775975)

You're describing a past which never happened; e.g. the entire point of DELL's initial business model was to compete on PRICE by marketing computers directly. By not having the overhead of a physical store, they managed to undercut other vendors, with more "traditional" sales approaches, in the fledgling PC clone market of the mid 80s. Then in the 90s they went one step ahead, and they tried to do as much "just in time" distribution as they could, in order to have as little inventory as possible (shipping directly from factory to consumer, thus reducing steps in the distribution chain).

The main reason why DELL's had great quality, initially, was to make sure people got confident in buying PCs from a vendor without a mortar and brick store nearby that could provide technical service.

Re:Dell should have declared bankruptcy (1)

Dunbal (464142) | about a year and a half ago | (#43776667)

A past that never happened? I remember DELL on the back cover of PC and Byte Magazines. And I remember the day of the $5000 Dell computer. Dell never competed on price - at least not at the beginning. The "cheap computers" were to be had from CompUSA, "Fast Data", and other dealers, for a good $2000 or more less than a Dell machine.

Re:Dell should have declared bankruptcy (1)

Dunbal (464142) | about a year and a half ago | (#43776679)

Not CompUSA... some other direct marketer with Comp in their name. I had a 33MHz 386 from them but I can't remember the brand name anymore. Too damned old.

Re:Dell should have declared bankruptcy (0)

Anonymous Coward | about a year and a half ago | (#43777229)

IIRC it was CompuDyne

Re:Dell should have declared bankruptcy (1)

Dunbal (464142) | about a year and a half ago | (#43780091)

Nope. CompuAdd [wikipedia.org] . I remember now. Far cheaper than Dell, and much nicer machines. Hell even Gateway was cheaper than Dell.

Re:Dell should have declared bankruptcy (0)

Anonymous Coward | about a year and a half ago | (#43776805)

Using Dell and quality in the same sentence, hell - post at all, invalidates your entire argument. Go back to answer Dell Help Desk calls...your numbers are dropping. Tell them to rebuild their pc again to solve their printer problem...

Re:Dell should have declared bankruptcy (1)

GigaplexNZ (1233886) | about a year and a half ago | (#43778153)

Using Dell and quality in the same sentence, hell - post at all, invalidates your entire argument. Go back to answer Dell Help Desk calls...your numbers are dropping. Tell them to rebuild their pc again to solve their printer problem...

You just invalidated your own argument by including the offending words in the same sentence.

Re:Dell should have declared bankruptcy (1)

whoever57 (658626) | about a year and a half ago | (#43776155)

I think you are confusing Compaq and Dell. Compaq used to sell insanely expensive and over-engineered PCs. I seem to remember my company paying $30k for a desktop PC from Compaq in the early '90s.

Re:Dell should have declared bankruptcy (1)

evilviper (135110) | about a year and a half ago | (#43777075)

Compaq used to sell insanely expensive and over-engineered PCs. I seem to remember my company paying $30k for a desktop PC from Compaq in the early '90s.

Compaq had very good WORKSTATIONS and SERVERS, but their PCs have always been cheap. I distinctly recall their later 90's PCs, which were non-standard over-sized motherboards, with all (cheap junk) components integrated onto them. They were right along side companies like Packard Bell in the race to the bottom.

Their workstations and servers, however, were always very nice. They used large fans, with plastic ducting, multiple thermal zones, etc, decades ago. They got the benefit of all that DEC engineering expertise and experience when they bought up the remnants of the company.

The same should be said of HP as well. Their desktop PCs were junk, but their workstations were heavily over-engineered and well-designed. I remember late 90's ~200MHz HP Workstations with numerous slots for memory, and a riser card that gave 6 PCI slots, as well as 2 ISA slots, which kept those PCs expandable and relevant far after their expected shelf life. Little touches like only two levers to pull to completely remove the case made them a pleasure to work with, as well.

And to Compaq and HP's credit, when HP bough the company, they dropped their own Netserver line, and rebranded the Compaq Proliant as the HP Proliant server, and that has now become the best selling x86 server brand out there, so they did something right. Though I'm still fairly annoyed at the licensing, limitations and clumsy proprietary tools to interface with their iLo out-of-band management.

Re:Dell should have declared bankruptcy (1)

HornWumpus (783565) | about a year and a half ago | (#43775845)

Intel has been giving away reference designs for 20 years.

Most Dell hardware is just generic PC hardware, bought in bulk, with 'Dell' silk screened on it.

Re:Dell should have declared bankruptcy (0)

Anonymous Coward | about a year and a half ago | (#43776355)

Minus a few components on the motherboard.

At the board meeting (3, Insightful)

Dunbal (464142) | about a year and a half ago | (#43775757)

Someone overheard part of the conversation which went something like "it turns out that people aren't as dumb as we though they were".

Re:At the board meeting (0)

Anonymous Coward | about a year and a half ago | (#43775931)

Someone overheard part of the conversation which went something like "it turns out that people aren't as dumb as we though they were".

It turns out that people aren't as dumb as we, though they were.

Re:At the board meeting (0)

Anonymous Coward | about a year and a half ago | (#43776009)

Someone overheard part of the conversation which went something like "it turns out that people aren't as dumb as we though they were".

It turns out that people aren't as dumb as we, though they were.

It! turns out that people aren't, as dumb as we though they were.

Re:At the board meeting (0)

Anonymous Coward | about a year and a half ago | (#43776179)

It turns out, that people are as dumb as we thought they were.

Re:At the board meeting (0)

Anonymous Coward | about a year and a half ago | (#43776377)

It turns out, people aren't as dumb as they thought we were.

Re:At the board meeting (0)

Anonymous Coward | about a year and a half ago | (#43777327)

It? Turns out, that, people! Aren't as dumb? As we, though - they were.

Re:At the board meeting (0)

Anonymous Coward | about a year and a half ago | (#43777907)

It turns. Out that people! Aren't as dumb as we-though they, were?

Re:At the board meeting (1)

Dunbal (464142) | about a year and a half ago | (#43776643)

Yeah, typo. Well spotted. I never used to make them but now I'm getting older :(

Re:At the board meeting (0)

Anonymous Coward | about a year and a half ago | (#43780045)

They're not, but meanwhile they have the entire Dell customer base to safely draw from.

Re:At the board meeting (0)

Anonymous Coward | about a year and a half ago | (#43780473)

It turns out, that people are not as dumb as they ought to be.

ugh! (1)

Anonymous Coward | about a year and a half ago | (#43775777)

Anybody else misread that as "Pubic Cloud"?

Re:ugh! (1)

Anonymous Coward | about a year and a half ago | (#43775799)

Anybody else misread that as "Pubic Cloud"?

Um... no?

Re:ugh! (1)

hawkinspeter (831501) | about a year and a half ago | (#43779313)

Nope: I misread it as "Pubic Clown"

Re:ugh! (0)

Anonymous Coward | about a year and a half ago | (#43779443)

Anybody else misread that as "Pubic Cloud"?

No, you probably have Dickslexia.

How will this affect Rackspace? (1)

Baby Duck (176251) | about a year and a half ago | (#43775779)

Hmmm, Dell provides a lot of hardware to Rackspace. Rackspace has an OpenStack implementation offering.

Re:How will this affect Rackspace? (1)

Desler (1608317) | about a year and a half ago | (#43775811)

Why would it affect Rackspace?

Re:How will this affect Rackspace? (0)

Anonymous Coward | about a year and a half ago | (#43775839)

Hmmm, Dell provides a lot of hardware to Rackspace. Rackspace has an OpenStack implementation offering.

Rackspace can go to hell.

Re:How will this affect Rackspace? (3, Funny)

mu51c10rd (187182) | about a year and a half ago | (#43776101)

Rackspace can go to hell.

Hell is already hosted on Amazon EWS...

Re:How will this affect Rackspace? (1)

IVI4573R (614125) | about a year and a half ago | (#43776243)

But if you want a T-Shirt it's back to Rackspace as they host tshirthell.

It isn't cheap, nor is it easy. (4, Insightful)

applematt84 (1135009) | about a year and a half ago | (#43776227)

Building and maintaining a public cloud offering is not cheap, nor is it easy. I was laid off from my last job due to the shortsightedness of the management staff. When I started asking for licensing and support from the vendors due to unforeseen issues, as well as additional equipment due to the growth rate, the management staff realized they couldn't do it as cheaply as they wanted. I have experience building an IaaS product, and that experience tells me to just let someone else deal with it that already has the issues figured out. Linode and Rackspace are great examples. In addition, if one wants to offer a custom portal for their clients, then I suggest you write an interface that uses your vendor's API and call it a day. 'nuff said.

Re:It isn't cheap, nor is it easy. (2)

atom1c (2868995) | about a year and a half ago | (#43776913)

And for Dell's part, they also realized that cooking the books wouldn't help their overall financial position without pulling a CA-style fraud.

After all, their OpenStack unit would have to buy equipment (presumably Dell servers), but that's just shuttling dollars from one P&L to another. They would surely need more customers footing that bill before rolling their own -- which, mark my words, is what they'll do once their P&L statements allow them.

Until that time, they'll just let the partners handle the infrastructure, have them pay for hardware, and keep the margins in the bank.

Re:It isn't cheap, nor is it easy. (1)

mysidia (191772) | about a year and a half ago | (#43778121)

And if Linode/Rackspace's nearest datacenters are so far from your geography, that the latency is too high for internal business apps?

Re: It isn't cheap, nor is it easy. (1)

applematt84 (1135009) | about a year and a half ago | (#43778333)

You have private clouds confused with public cloud offerings. You are thinking about a private cloud, not an IaaS public cloud. If you have the funds and resources, then by all means, build yourself a private cloud using VMware, XenServer or KVM. A public cloud offering IaaS product involves offering a web portal for your clients to build their own VMs ... like what Linode, Rackspace, etc. offer. If you are really concerned about latency then a private cloud would be the best solution. If you are using an application in a public cloud that is sensitive to latency, then I suggest you seriously re-evaluate your solution.

Re: It isn't cheap, nor is it easy. (1)

mysidia (191772) | about a year and a half ago | (#43778775)

If you are really concerned about latency then a private cloud would be the best solution.,

Ah, but you see... It's not about private clouds... it's not me alone that is concerned about latency... it would be my customers that would be considering using a cloud service for their internal servers, because there are no big datacenters nearby, but my datacenter is nearby...

The big cloud providers' datacenters are far-away net-wise, so I ought to be able to service some latency-sensitive workloads with good performance at a level of service that Linode/Rackspace could not possibly hope to provide... naturally, I would expect to be paid a premium for doing this, but if there is sufficien demand, it still ought to be reasonable for me to build..

Re: It isn't cheap, nor is it easy. (1)

applematt84 (1135009) | about a year and a half ago | (#43780655)

I still think you have private and public clouds confused. A private cloud would be a single physical server on-premises, or uplinked to the clients office from a datacenter via MPLS circuit, that is managed by a single client like XenCenter (XenServer), vSphere (VMware) or System Center (HyperV). This allows one to spin up multiple VMs that would logically sit on their internal network and be perfect for low-latency, internal applications.

A public cloud offering is where you have a scaleable cluster of compute nodes connected to a massive backend storage system (like a NetApp- or HP-iSCSI SAN) and is managed by a management server running OpenStack, CloudStack, OpenNebula or whatnot. This then allows any user to simply login and create a VM with no guarantee of low-latency connectivity or functionality of use for internal applications, which is what you get with big-cloud providers. I certainly would not recommend using Linode, Rackspace, etc. for an internal server due to security concerns. A public cloud offering is what my original post was referring to and I apologize if I confused you. In your situation, depending on how many clients you have, I would heed warning as to whether or not you want to go the route of an Enterprise-level cloud service provider; but I do wish you the best of luck. It isn't cheap, and it isn't easy. :P

Re: It isn't cheap, nor is it easy. (0)

Anonymous Coward | about a year and a half ago | (#43781041)

I still think you have private and public clouds confused.

I think everyone has them confused, because of buzzword bullshit surrounding 'cloud computing'.

Private cloud these days means, "Here's a bunch of resources you can do what you want to, running on my shit at my datacenter. And hey, if I'm not incompetent, there might be some VLANs or something involved maybe."

Which of course, isn't an actual private cloud, but it's apparently cloud, and it's somewhat private, so hey, marketing win.

Re: It isn't cheap, nor is it easy. (1)

mysidia (191772) | about a year and a half ago | (#43800795)

A private cloud would be a single physical server on-premises, or uplinked to the clients office from a datacenter via MPLS circuit

The private/public distinction seems totally artificial then.

Does it really matter whether their internet service is residing in a VRF, with IP space routed to a VLAN on the virtualization cluster, or whether the end user has a site-to-site VPN solution, as if a VPN suddenly makes it public?

Is the distinction private/public not totally artificial?

Of course there should be a scalable cluster and a large storage array, as shared storage is required for high availability. If you don't have a cluster, then you have a single physical server... not a cloud, where things are distributed and protected.

I see no reason OpenStack, CloudStack, OpenNebula would be required.. right... those are essentially APIs to optionally enable developers to do a lot of fancy things. just create a user in vCenter for the admins in each organization, with read access and remote console/power/reboot to only their vApp, and a couple orchestrator workflows for setup/teardown, which is more than most need -- when most people are reliant on the technology provider support department to do all their planning and provisioning anyhow.

THIEVING BASTARDS (0)

Anonymous Coward | about a year and a half ago | (#43776629)

Just kidding.. Dell charge way too much for their cloud service and can't deliver, it's no surprise that they're cutting back now...

They couldn't get a good price on servers... (3, Insightful)

evilviper (135110) | about a year and a half ago | (#43776979)

Could it be that Dell discovered the hard way that their servers are, in-fact, too expensive? Companies like Dell and HP are seeing declining server sales due to projects like OpenCompute that are bypassing 1st tier vendors and going straight to ODMs for simpler, cheaper servers. Some of the companies buying these cheap servers include cloud service providers like Amazon.

Obviously Dell can't do that with their own in-house offerings, so perhaps they just couldn't compete with vendors running on cheaper servers.

Re:They couldn't get a good price on servers... (1)

eap (91469) | about a year and a half ago | (#43784175)

...Obviously Dell can't do that with their own in-house offerings, so perhaps they just couldn't compete with vendors running on cheaper servers.

Dell's public cloud problem wasn't hardware. Cloud providers buy hardware before building the service. Dell failed to stand up a live OpenStack public cloud. HP and Rackspace already have theirs running with real customers.

Building a public cloud is hard. It takes either a big company with lots of resources, or a smaller dedicated company with good funding. Both require long term commitments.

Corporate spin department (0)

Anonymous Coward | about a year and a half ago | (#43777009)

Dude, you're getting an even better cloud than the one we were talking about. Somebody else's!

Openstack isn't particularly good... (1)

Anonymous Coward | about a year and a half ago | (#43777549)

While I recognize that Dell's failure in the industry doesn't indict Openstack, it's really not that good.

Every well known provider either doesn't use it, or at best uses it in a token fashion to appear 'open'. The reason is pretty straightforward, it's functional scope is sufficiently limited that each vendor is just as well off writing their own private solution. It actually takes less work to charge forward with your own implementation than go through the hoops of coordinating with a wider community comprised of people with goals and strategies that may directly oppose each other in this sort of thing.

We've seen repeated changes in this space with the 'promise' of building a less segmented public cloud market. OVF, Eucalytpus, a few DMTF attempts, all promising to deliver a market that is somehow magically standardized, none of them coming to fruition, but each time causing huge chunks of the market to fall over themselves in what seems to be an attempt to seem 'hip' and progressive.

Took them long enough... (1)

Cyberax (705495) | about a year and a half ago | (#43779463)

So they've finally realized that OpenStack is just a death-knell for the IaaS industry. It commoditizes it and enables a race to the bottom, like it earlier happened with web hosting and later with individual VPS hosting. A couple of years from now and we're going to be swamped by small companies offering OpenStack-based clouds.

And so instead of trying to capitalize on their own server production unit and compete on price, Dell's going to try and differentiate themselves using some half-assed proprietary offerings. And since every company trusts Dell enough to build their critical infrastructure on Dell's proprietary systems then it certainly is going to be a smash hit in the industry. Not.

Re:Took them long enough... (0)

Anonymous Coward | about a year and a half ago | (#43779997)

On the bright side, if we get swamped with it as you say, the IT press might finally stop being cheerleaders for "The Cloud" as a solution to every single IT problem that ever bothers business executives. Of course, what really bothers business executives is dealing with IT people, since those types have a nasty habit of saying what will and won't work, and reality is just not wanted in modern American business. The Cloud promised executives a way to finally stop having to deal with these reality based annoyances, and yet it just didn't work out that way, did it? Could it really be that hosting large transaction volume critical business processes with a profit making vendor can actually be expensive and complicated? But the demos and airplane magazines made it look so easy!

Can't wait to see what The Next Great Thing is going to be.

Not enough control of private data (1)

who_stole_my_kidneys (1956012) | about a year and a half ago | (#43781515)

I was working with a company who signed a contract with dell to have people start implementing "private clouds" on the Microsoft platform. I think they realized that most organization need more control over their data due to regulations and solutions like this may not meet those needs.
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