UPDATED 06:50 EST / OCTOBER 14 2014

EMC CEO Joe Tucci NEWS

EMC buys into OpenStack with Cloudscaling acquisition

Elliot Management publicly urges EMC to spin off VMware

EMC CEO Joe Tucci

It might be struggling to keep its federation together, but that hasn’t stopped EMC Corp. from furthering its expansion efforts elsewhere. This time round it’s just bought into OpenStack with the acquisition of The Cloudscaling Group, Inc., one of the first vendors to sell it’s own distribution of the open-source cloud software.

Cloudscaling’s offering is fairly unique, as it runs private OpenStack clouds on hardware of its own choosing within its own data centers, and can integrate these clouds with public clouds from Amazon Web Services, Google Compute Engine and the like.

EMC’s involvement means it’s just become the latest gigantic tech vendor to force its way into the OpenStack ecosystem. Last month, Hewlett-Packard Company swooped to buy Eucalyptus Systems, Inc. to boost its own Helion Cloud, and this was quickly followed by Cisco Systems Inc., which bought MetaCloud Inc., a provider of managed OpenStack services. EMC has actually been involved with the OpenStack Foundation for more than two years, but yesterday’s acquisition marks its first major investment in the open-source framework.

But just because EMC’s bought into OpenStack doesn’t mean it’s guaranteed to get any traction. Like most OpenStack vendors, Cloudscaling has been more talk than action and so far relies on single case study to show off what it can do.

Bloomberg values the deal at less than $50 million, not a whole lot, but a nice return for a firm that’s got by on just $14 million in venture capital funding.

As for what EMC’s intentions are, the company said in a statement it plans to “further extend our breadth of cloud platform support”, whatever that means. How this will affect its partnerships with VMware Inc., and Pivotal Labs remains to be seen, but hopefully we’ll hear more about it at EMC’s next major cloud computing and networking event on October 28.


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