According to “Connecting Capabilities: the Asian Digital Transformation Index”, a report by The Economist Intelligence Unit, digital transformation continues to be a high priority for business leaders, as efforts in that space can lead to improved innovation, streamlined processes, cost savings, and the creation of new offerings that can both create new markets and defend against competition from disruptors.
As digital transformation processes become more and more important for businesses, opensource platforms will increasingly become a strategic investment for business, especially in order to stay resilient in the face of exponential activity and data growth as organizations take steps to keep pulse of changing customer demands.
What is digital transformation?
Digital transformation is a catch-all phrase used to describe the acceleration of IT to make fundamental, and even radical changes in the way businesses operate and deliver value to their customers. While the execution may be different across industry verticals, companies share many common characteristics on these journeys that can change their internal cultures.
Digital transformation means the adoption of more innovative development environments that embrace relatively new practices, many of which are still being defined, as well as frequent experimentation, requiring organizations to become comfortable with failure as normal part of the innovation process. The question is: what does this mean for the service provider trying to navigate the competitive cloud environment, and how can they take advantage of this trend?
The benefits of OpenStack
Recently, SUSE commissioned a 451 Research pathfinder report,“OpenStack – Enabler of Digital Transformation – How Service Providers Can Benefit.” This report focuses on using opensource platforms to build a next-generation software-defined infrastructure.
In the key report findings, open source platforms are enabling service providers to better support their customers’ digital transformation initiatives by taking advantage of openness, vendor-neutrality, and leveraging the vast community of open source developers.
Service providers with a history of vendor independence and as a “trusted business advisor” will also benefit most from open source. The research also detected growing adoption of opensource cloud technology in all geographies where local data storage, language, application expertise and customization are key differentiators.
Scaling heights over the hyperscalers
While the rate of cloud adoption is accelerated by digital transformation, we see most service providers struggling to compete with hyperscale cloud companies on price and available services. OpenStack is the most widely used open source cloud platform to address these two issues head-on.
From an investment perspective, OpenStack does not require the expensive licensing cost of commercial proprietary cloud platforms. Due to widespread adoption, most hardware vendors already support OpenStack with drivers and software, which allows you to use your existing infrastructure. In addition, because you can switch distributions, or even “do-it-yourself,” it is very hard for an OpenStack distribution vendor to use lock-in to increase prices. Furthermore, OpenStack is built around policy-defined deployment and automation, so once you’re established, day-to-day operations cost can be greatly reduced.
It’s worth noting that a lot of advances and services innovation found in hyperscale cloud companies is actually mostly achieved by leveraging the thousands of developers in the open source community, and OpenStack provides a compatible platform for taking advantage of these, and even more advanced developments. The latest advances in distributed databases, containers, Kubernetes automation and scaling, platform as a service (PaaS), artificial intelligence, machine learning, Internet-of-Things and 5G networks are all available on OpenStack – sometimes long before the proprietary cloud vendors can develop systems to exploit these new technologies and make them available across all geographies.
As customers embrace hybrid environments, the same technology that can be offered both online can also be implemented in their own datacenters. Many companies choose to put their variable workloads in the cloud (e.g., development and emergency capacity), while keeping production on-site. This means that service offerings can now include the management of a company’s entire hybrid environment (both on-premise and in the service provider’s data center), enabling customers to place their workloads wherever they make the most sense.
Recommendations for service providers
OpenStack can enable service providers to reduce cost while accelerating the creation of the innovative services that customers demand.
Most providers run OpenStack side by side with their existing architecture to become familiar with the technology. Initially, non-critical workloads are migrated over to take advantage of the cost savings.
In a recent Forrester study, the average customer adopting OpenStack showed a 380 percent return on investment, with payback in under six months. While there is an upfront learning curve, with time, as experience and familiarity grow, we believe more and more workloads will move over to OpenStack – treading the well-worn path taken by virtualization as well as most IT initiatives.