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August 24, 2015

Intel bets on OpenStack in public cloud race

Investment in Mirantis could help make OpenStack a more viable competitor to public cloud giants such as Amazon Web Services and Microsoft Azure.

By James Nunns

Intel is betting on OpenStack to take on public cloud vendors with investment in Mirantis.

The chip maker took the lead in a $100 million fundraising which was also supported by Goldman Sachs and other existing investors such as Sapphire Ventures and Ericsson.

This isn’t just a one off investment from Intel, which also invested in the OpenStack company back in 2013. The significance of this investment now is that it will also be committing to finance future technology development.

Not only could this investment be a boost to Mirantis as it looks to increase the uptake of the product, it could also prove to be a good move for Intel as it looks to increase sales of its own technology.

Intel recently pledged to make a number of investments under the Cloud for All initiative, which it is hoping will make corporate data centres capable of mirroring the efficiency of cloud services like AWS and Microsoft Azure.

A key reason why this is a big move for OpenStack as a whole is that it could help the technology to overcome some of its shortcomings, specifically to minimise service outages. As more tech giants get on board with OpenStack it is likely to make the technology a more viable alternative to the likes of AWS.

Alex Freedland, Mirantis co-founder and president, said: "The only way for the industry to have an answer to challenge the public cloud offering is to have a platform that works as well."

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The OpenStack community is in Freedland’s view, a way to stop Amazon from getting an ‘oligopoly’ and to maintain openness in cloud.

Freedland, said: "If Amazon wins this and gets an oligopoly, the whole innovative IT community of infrastructure application folks will die. So there’s very strong collaboration happening in the community."

Intel is appearing as a company that is committed to supporting open source technologies, with the company investing $740m in a deal between itself and Cloudera in the Hadoop Big Data market.

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