Mayor Ivy Taylor speaks to the audience at Rackspace on Thursday. Photo by Joan Vinson.
Mayor Ivy Taylor speaks to the audience at Rackspace on Thursday. Photo by Joan Vinson.

For the naysayers of 2014 who predicted the demise or departure of Rackspace, saying it couldn’t remain competitive in the expanding cloud universe from its San Antonio base, Thursday’s announcement that Intel and Rackspace are teaming up to create an “OpenStack Innovation Center” in San Antonio should allay any lingering doubts.

The new cloud alliance could lead to 150 or more software engineers employed by Intel, the world’s best known semiconductor chip maker, relocating to San Antonio and Rackspace headquarters to help build out OpenStack, which has now been adopted by IBM, Google, AT&T dozens of major tech companies ranging from Dell to Cisco, and hundreds of other major corporations.

Rackspace, the #1 managed cloud company, posted this joint announcement with Intel Thursday afternoon announcing the new partnership, a press release that some tech executives who do not have direct knowledge of the deal and spoke on background said is probably understated in its importance for Rackspace and the tech sector in San Antonio.

The OpenStack, now managed by the OpenStack Foundation, was jointly launched by Rackspace and NASA in July 2010 to little fanfare at the time, an open source cloud software platform that some industry critics suggested said would never catch on with the tech world’s major players. For Rackspace, the initiative meant it was giving away software many thought should remain proprietary as an inducement to companies to join in what would become a fast-growing universe of collaborative users.

Back then, competitors didn’t see the logic of collaboration, but that seems to be changing rapidly with each new announcement of companies deciding to work together on major projects. Today, Rackspace and Intel are among the eight Platinum level leaders of the foundation.

The two companies said in the release that the new San Antonio-based center “will help accelerate the development of enterprise capabilities and significantly add to the number of developers contributing to upstream OpenStack code.  The project will bring together OpenStack engineers from Rackspace and Intel to advance the scalability, manageability and reliability of OpenStack by adding new features, functionality and eliminating bugs through upstream code contributions.”

The announcement drew immediate online coverage from the national tech media that watches the competitive cloud sector closely. One tech executive here said the deal “demonstrates the resilience of Rackspace to find innovative ways to compete with Seattle, San Francisco and other tech capitals without abandoning its San Antonio roots.”

The announcement follows a previously announced agreement between Rackspace and Microsoft for Rackspace to offer cloud hosting for MS Office 365, a deal that is expected to contribute to Rackspace’s bottom line but will not have the impact of the Intel deal in terms of adding new software engineering talent to the still-shallow San Antonio pool.

That influx of talent could be the most significant outcome of the alliance.

“We are excited to collaborate with Intel and look forward to working with the OpenStack community to make the world’s leading open-source cloud operating system even stronger,” said Scott Crenshaw, senior vice president of product and strategy at Rackspace.  “We don’t believe in creating proprietary OpenStack distributions.  Rackspace delivers its customers four-nines availability using entirely upstream trunk code. All of the Innovation Center’s contributions will be made available freely, to everyone.”

That’s a foreign language to many, but the importance of the deal for the average San Antonian is that Rackspace, even through a period when its stock has not attracted strong interest among market analysts, continues to innovate and demonstrate the ability to grow through collaborative partnerships with much bigger tech players once thought by some to represent the greatest threat to Rackspace.

The growth of OpenStack as a preferred open source software option over the last five years has been nothing short of a quiet phenomenon, allowing companies to securely manage data and networks in open cloud, or if desired, via private clouds in Rackspace data centers or located on company premises.

OpenStack now counts 520 member companies and 27,000 individual contributors across 167 countries, according to Rackspace, the operator of the world’s largest production OpenStack cloud.

“This announcement demonstrates our continued support and commitment to open source projects,” said Jason Waxman, vice president and general manager of the Cloud Platforms Group at Intel.  “Our ongoing collaboration with Rackspace and the OpenStack community represents an ideal opportunity to accelerate the enterprise appeal of OpenStack.”

According to the joint press release, the agreement between Rackspace and Intel includes:

  • OpenStack Innovation Center – The center will create the world’s largest OpenStack development team. It will be comprised of Rackspace and Intel engineers and will be located at Rackspace’s corporate headquarters in San Antonio.
  • OpenStack Developer Training – Through this effort, Rackspace and Intel will offer new modules of courseware designed to onboard and increase the number of open source developers actively contributing to the success of the community.
  • Joint OpenStack Engineering – Rackspace and Intel will resource OpenStack development, working in collaboration with the OpenStack Enterprise Work Group and community, targeting bug elimination and the development of new enterprise features. The companies will recruit new engineers to participate in OpenStack development.
  • Largest OpenStack Developer Cloud– Rackspace and Intel will build and make available to the community two 1,000 node clusters to support advanced, large-scale testing of OpenStack and new features developed through the joint engineering work. The companies anticipate having the clusters available for community use within the next six months.

“The community’s goal is to foster collaboration and spur innovation that drives broad adoption,” said Jonathan Bryce, executive director of the OpenStack Foundation. “The depth of experience and community engagement that Rackspace and Intel offer makes this an exciting project, as the code contributions and large-scale testing will benefit everyone who uses OpenStack.”

*Featured photo: Mayor Ivy Taylor speaks Thursday at Rackspace during an SA2020 event. Photo by Joan Vinson.

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Robert Rivard

Robert Rivard is co-founder and columnist at the San Antonio Report.