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TheStreet Open House

Red Hat CEO Jim Whitehurst: We're Ready to Dominate the Cloud

NEW YORK (TheStreet) -- The enterprise is shifting. What we've come to know as network and application infrastructure is transitioning towards the private cloud. Very few understand this better than Red Hat's (RHT) CEO Jim Whitehurst, who's positioning his company to become the leader in OpenStack.

He wants Red Hat to be able to offer cloud solutions that are scalable, feature-rich, yet easy to implement. Even better, he believes he can offer these services at a fraction of the cost enterprises are paying today. At around $61, Red Hat's shares are up 9.4% for the year to date, surpassing the S&P 500, which is up 8.3% for the same period. 

In a recent interview at Red Hat headquarters, Whitehurst said OpenStack will emerge as the "default choice for next-generation architecture." He's not alone in that belief.

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This sentiment is shared by some of the world's largest corporate leaders, including Hewlett-Packard (HPQ) CEO Meg Whitman, who just launched Helion, a portfolio of cloud products and services. Industry experts believe Helion, which is billed as an integrator of public and private clouds, has the potential to be a game changer.

But HP has ways to go to supplant Cisco (CSCO) , which is by far the leader in cloud infrastructure equipment revenue. Then there's IBM (IBM) , which is hedging its future on its ability to dominate the cloud with Watson, the company's cognitive computing platform now open to developers. IBM claims the Watson Developer Cloud "has the potential to disrupt industries."

On the other hand, investors aren't sure exactly where to place their bets.

Microsoft (MSFT) isn't going anywhere. Neither is Oracle (ORCL) . There is Red Hat nemesis VMware (VMW) , whose name has become synonymous with the cloud and virtualization platforms like vSphere and Hyper-V. VMware just announced its VMware Integrated OpenStack, suggesting a move towards enterprise cloud stacks.

This is the logical next step for VMware. At the same time, this decision can be interpreted as an admission by VMware that OpenStack is here to stay. It supports earlier claims by Whitehurst that there's been a disconnect between server virtualization and what enterprises currently understand as the cloud.

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To that end, Red Hat's rapidly deploying various cloud platforms like Red Hat CloudForms. The company's recently launched 3.1 version, its open hybrid cloud management solution, has the ability to extent cloud management solutions across private, public and hybrid cloud. It supports OpenStack enhancements of competing platforms including Amazon (AMZN) Web Services, Microsoft's System Center and even VMware.

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