This Day On The Street
Continue to site right-arrow
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

Red Hat Aims Its Cloud at Bigger Rival VMware

Stocks in this article: VMW RHT EMC RAX

BOSTON ( TheStreet) -- Red Hat (RHT) has decided its place in the cloud computing sunlight depends on taking on VMware (VMW).

VMware has the early lead. Companies that have created "virtual" servers to save on data center hardware have been using its vSphere for years. The software has evolved into a full cloud operating system. Many store their data mountains inside EMC data server devices -- EMC (EMC) owns 80% of the company. VMware's vCloud lets companies move virtualized workspaces into the public cloud.

The trouble is these are closed-source, proprietary products. Customers that commit to VMware are locked in just as securely as if they'd bought Microsoft Windows.

Or so goes the Red Hat argument.

At its Red Hat Summit in Boston this week, the company took direct aim at VMware with what it calls Hybrid IaaS. This combines Red Hat Enterprise Linux, virtualization and CloudForms cloud management for $500 per cloud instance. VMware charges $502/instance for virtualization alone.

Red Hat is also taking aim at VMware parent EMC's network storage business with Red Hat Storage Server 2.0, also announced at the summit. RHSS is based on Gluster, an open source project acquired last year. Its aim is to let companies build cloud storage from commodity hardware rather than specialized servers.

Ranga Rangachari, vice president and general manager for storage, said RHSS can cut the cost of storing a gigabyte of cloud data from $1.10 to 29 cents "with better performance" because storage is integrated into the cloud rather than sitting on a separate device.

The full Platform as a Service (PaaS) offering, called OpenShift, is designed to ride on a cloud infrastructure, and Red Hat recently committed to OpenStack, first sponsored by Rackspace (RAX), for its Infrastructure as a Service (IaaS) offering. That's one difference between being proprietary and being open source -- community momentum can drive your decisions.

But another difference is that you're commercializing software that people can also get free. Red Hat's flagship Red Hat Enterprise Linux product is based on Fedora, a free Linux. And Red Hat Network Storage is based on Gluster, an open source project acquired just last year.

1 of 2

Select the service that is right for you!

Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!


DOW 17,804.80 +26.65 0.15%
S&P 500 2,070.65 +9.42 0.46%
NASDAQ 4,765.38 +16.9840 0.36%

Brokerage Partners

Rates from

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs