The company also reported a segment profit of $31.2 million on revenues of $62 million for its third quarter. The new services appeal to different markets and allow customers to future-proof cloud investments, moving from one cloud platform to another or using a hybrid approach as priorities and business needs evolve, says Internap's Paul Carmody, senior VP of product management and business development.
Leveraging the open source Xen cloud platform and integrated with Internap’s OpenStack-based cloud storage offering, the public cloud service has caught the interest of gaming companies that must deal with spiky usage, he says. The VMware offerings tend to appeal more to enterprises, but both audiences also have current and future applications for both sets of offerings.
In addition to the scalability of the open source offering, it is less costly so it appeals to enterprise customers for test and development, says Carmody. As gaming and other Internet-based companies grow, they will need elements of both, he says. For instance, databases run better on dedicated as opposed to public clouds. "As they get bigger, the amount of stuff they want to have on dedicated clouds grows." The pay-as-you-go, multitenant Custom Public Cloud leverages the VMware platform, which eliminates the need to re-architect applications that have already been virtualized internally, says Internap.
Customers can architect tailored cloud configurations and create customized network configurations on demand through VMware’s vCloud Director portal. The company has two offerings built around vCloud Director: The Virtual Private Cloud service allows customers to reserve compute, memory and storage resources, and tailor each virtual machine instance to meet organizational needs; and for on-demand usage with utility-based billing, the Custom Public Cloud service allows customers to address fluctuating infrastructure requirements such as prototyping, testing and dynamic application scalability.
Gartner's Ted Chamberlin, research VP, UC and network services, infrastructure and operations, says Internap has definitely created a palpable buzz in the competitive landscape and that it has underscored the notion that many service providers who are late to the cloud services market will look for a turn-key or white label solution with which they can have a cloud offering up and running in six to eight months instead of two to three years. "Enterprise IT will continue to look at OpenStack as an alternative to more self-service IaaS solutions, such as Amazon Web services, GoGrid, Tata Instacompute and other Citrix/Cloud.com powered platforms."
He sees this as a bigger deal for Internap than for the OpenStack camp. "Internap had to quickly gain ground in the hosting and cloud space in order to be relevant, and OpenStack provided them with the quick start into a lower-cost, more highly scalable platform than VMware could provide. This is good for OpenStack as it moved the foundation from pure development projects into production retail offering."
Quoting Gartner data, Internap says public cloud services spending is expected to grow four times faster than overall IT spending, reaching nearly $177 billion by 2015. Chamberlin says it's difficult to say initially how OpenStack will do in the enterprise market, but it is getting more enterprise-friendly with each revision. "At this point, enterprise adoption is very minimal as OpenStack is akin to a toolbox that enterprises can open up and take a tool; but they still need blueprints and expertise to build a finished product. My guess is that enterprise IT will probably adopt and implement portions of OpenStack [object store, portal capabilities, open networking] to a larger degree before they adopt the entire suite of services."
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