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Amazon to See a New Cloud Market in 2013

Stocks in this article: AMZN NFLX GOOG YHOO RHT RAX HPQ DELL IBM

For many, OpenStack will be the answer. OpenStack is open source, and most major enterprise players now support it.

Red Hat (RHT - Get Report) has focused its own Open Shift platform on OpenStack. Rackspace (RAX - Get Report), the original sponsor, has more OpenStack experts than anyone and has finally shifted its own operations to it.

Dell (DELL - Get Report) and Hewlett-Packard (HPQ - Get Report) are both building global cloud networks based on OpenStack. So are most major telcos. IBM (IBM - Get Report) is a platinum sponsor of the code base.

There are ways in which companies can have their Openstack and Amazon, too. Eucalyptus , led by former mySQL head Marten Mickos, is among those working hard to bridge the gap between Amazon EC2 and these new open source clouds.

Amazon's dominant share in the cloud is going down as that of OpenStack is going up. Companies are going to be building their own "private" clouds in 2013, and many will want public clouds that support the same system, creating a so-called "hybrid" cloud. They won't mind the extra expense if they get redundancy, resiliency and a single throat they can choke if something goes wrong.

For the cloud, 2012 has been a year of commitment, and 2013 will be a year of action. This is negative for Amazon. But this will be good for the cloud.

At the time of publication the author had positions in GOOG, IBM, YHOO and RHT.

This article was written by an independent contributor, separate from TheStreet's regular news coverage.

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