HubSpot latest to leave Amazon Web Services -- mostly. Should Amazon worry?

HubSpot is the latest to announce it’s shifting workloads off AWS

By  

A week ago I quoted Piston’s CTO saying that there was a “giant explosion” of companies moving off of Amazon Web Services (AWS). At the time, I noted that he had good reason to say that, since he started a company that builds software used by companies to build private clouds.

She was fast, beautiful, unbridled and let us do things we could never do.

Jim O’Neill, CIO for HubSpot, on moving to the public cloud

This week at the OpenStack Summit, I’m hearing more murmurings about companies moving away from AWS, including one example of a large company doing so, but the moves feel measured. Rather than a dramatic abandonment of AWS, it’s more like a byproduct of companies gaining experience in the cloud and learning which applications make sense in public and private deployments.

Take HubSpot. It started out in a managed environment. Then “along came the public cloud,” said Jim O’Neill, CIO for HubSpot, a company that provides inbound marketing services. “She was fast, beautiful, unbridled and let us do things we could never do.” HubSpot started using AWS.

But eventually HubSpot struggled with the number of “zombie servers,” or unused servers that the company was paying for. At scale, that became a significant problem, O’Neill said.

Those zombies also had a negative impact on service quality. To get to the level of reliability it wanted, HubSpot needed more control than it could get from public cloud.

It went to an OpenStack summit in 2011 and within a month had built nine nodes, doubling that to 16 nodes in nine months, for a total of 224 cores. Six months later, taking us to earlier this year, it had 166 nodes and 2,000 cores. Its private cloud is managed by Rackspace and is actually a hybrid environment, also using Rackspace’s public cloud. HubSpot also still uses AWS, although O’Neill didn’t specify how.

Rackspace said it’s seeing some companies transitioning off public clouds, but for natural reasons that don’t indicate doom for any public providers. Later stage startups of the kind that are very sophisticated and are really pushing boundaries and “doing things no one has done” are sometimes going in house, said John Engates, CTO of Rackspace.

With a private cloud, businesses can control more variables to boost efficiency and especially to try to achieve more consistent performance, he said.

Enterprises that are moving to private clouds tend to be those that had developers start using the cloud without permission. In that case, IT might decide to pull the cloud in house and transition those applications to the private cloud, he said. “Those aren’t technical reasons, they’re business reasons,” Engates noted.

Cost is a business reason that some businesses are leaving public clouds and going private, executives from both Cisco and Redapt told me.

Shannon McFarland, a principal engineer at Cisco, had an interesting take. He said that some companies now have the kind of data that lets them more accurately consider the OpEx vs. CapEx question.

These are businesses where IT departments have essentially been exploiting a “loophole” that makes it look like they’ve reduced CapEx when in reality they really haven’t. For instance, an IT organization might be under orders to reduce CapEx and to do so might hire a system integrator that essentially spreads out the cost of a hardware and software investment into monthly payments.

“CFOs have figured this out,” McFarland. The upside is that for businesses that also have some experience using public clouds, CFOs can use that data to better understand how the cost of a private cloud compares to a public cloud, he said.

Jeff Dickey, senior vice president of cloud solutions for Redapt also said he’s seeing businesses move their clouds in house because AWS is proving expensive. Their primary reasons for building private clouds: cost, control and security, he said.

Businesses of all sizes are considering internal clouds, but it makes the most sense for large companies, he said.

Other businesses are “trying to get out,” he said. AWS has made its compute services very sticky by making them difficult for users to remove workloads like databases to run them elsewhere.

Regardless, most companies are leaving some work loads in the public cloud like AWS, he said. For users of Rackspace’s public cloud, he’ll help get the hardware set up and then Rackspace may offer its support services

Several people I had breakfast with said that they are hearing customers tell them that AWS is reducing costs for individual businesses in an effort to keep them. That’s not so uncommon in the vendor world, where many costs are negotiable depending on the size of the business. But I’m not sure if this is a new trend from AWS or if it’s been reducing prices on a case by case basis all along.

While some of the people I talked to stand to benefit from work moving off public clouds, others didn’t. It’s impossible to know whether a significant number of businesses are deserting AWS and public clouds in favor of private. My guess is there’s some movement as businesses get more experience in the cloud but certainly not enough to dent the potential of the public cloud. Still, the murmurs are an indication that AWS competitors are starting to get more aggressive.

Read more of Nancy Gohring's "To the Cloud" blog and follow the latest IT news at ITworld. Follow Nancy on Twitter at @ngohring. For the latest IT news, analysis and how-tos, follow ITworld on Twitter and Facebook.

Join us:
Facebook

Twitter

Pinterest

Tumblr

LinkedIn

Google+

Answers - Powered by ITworld

ITworld Answers helps you solve problems and share expertise. Ask a question or take a crack at answering the new questions below.

Join us:
Facebook

Twitter

Pinterest

Tumblr

LinkedIn

Google+

Ask a Question
randomness