With Hewlett-Packard’s recent announcement of HP Helion, there are questions lingering about how the company can compete in the public cloud market, while using OpenStack as a way to get into the enterprise.

In this interview with theCUBE’s John Furrier and Dave Vellante at EMC World, Jason Mendenhall, EVP of cloud at Switch, discusses the challenges of enterprises going open source as well as the difference between cloud service guys and enterprises.

• Cloud Service Guys vs. Enterprises

“What we know about the cloud service guys is that density equals margin,” said Mendenhall. They need the ability to get super dense in the data center and delivering a very dense product at scale is really important to them. Another essential for cloud service guys is connectivity. In regard to enterprises, Mendenhall believes the same things play well, but tend not to grow in the same way cloud providers do. He explained that enterprises grow in chunks based on projects, while cloud providers grow based on revenue increases.

Public and Private Cloud Orchestration

Mendenhall also talked about people moving workloads between the public and private clouds. This is the scenario he laid out: People push workloads into the public cloud then move to private. They see people doing dev and QA in the public cloud and realize that it works really well for production, and then production moves into the public cloud as well. This wide array of services is being leveraged and will eventually evolve into, what Mendenhall calls, “an And, Not and Or” landscape. However, if a person has VBlocks both in the private and public space with a service stack of things that are the right solution for the right application, the challenge is now managing it all. Mendenhall said we’ve been watching that orchestration take place for a long time and he’s noticing some interesting tools coming into fruition.

• You Can’t Just Bolt Public Cloud on the Enterprise

Bringing up the subject of HP Helion, Furrier asked Mendenhall to break down how HP is able to be in the public cloud market while, at the same time, having a variety of enterprise approach with OpenStack. Referencing Amazon as the leader in public cloud, he said “you can’t just bolt that on the enterprise.” Furrier added HP seems to be playing in two worlds.

Mendenhall started off by saying Amazon has a big engine that’s very easy and meaningful to integrate with, but there’s no pathway to moving that in-house. HP Cloud, however, is going to take a different bend as it heads into OpenStack. In fact, OpenStack’s highest code contributor is HP Cloud.

Mendenhall then explained when you move OpenStack in-house, it’s still open source, which means IT managers understand that they need a pretty good set of developers who can continuously evolve the code. This is the problem that OpenStack creates for enterprises. He advised enterprises to understand the long road ahead and figure out what’s going to best for them.

“What workloads are they really trying to optimize? Are you trying to manage this public-facing, web scale application that has a lot of mobile touch points to it or are you trying to manage some of your enterprise applications and your back office IT and be more effective about the way you deploy as an organization?,” Mendenhall said as examples of questions that enterprises should consider. “That balance will dictate which one is going to make the most sense for you,” he added.

To sum things up, if you bring open source in-house, it’s not always easy to find developers. Plus, managing that open source engine and keeping it going is a challenge as well.