Nokia has announced that it is moving its cloud infrastructure and container business to Red Hat, as it decides to focus on cloud core applications and software, rather than the underlying infrastructure.
350 Nokia personnel from its cloud infrastructure unit – including product development, tier three and four customer service and professional services teams – will move over to Red Hat. Red Hat will take on ongoing support and development of Nokia Container Services (NCS) and Nokia CloudBand Infrastructure Software (CBIS) customers. Over time those customers are expected to migrate to Red Hat’s own platform.
Darrell Jordan-Smith, Senior Vice President, Telecommunications, Media and Entertainment & Edge, Red Hat, said that the telco space is very important to Red Hat, and that many of Nokia’s customers are already Red Hat users.
“We see it as a great and symbiotic way of bringing key resources into our business to allow us to expand and scale with knowledge and a specific telecommunications, with an exciting client and customer base that we feel that we need to earn the right to work with and engage with as we move forward. From our perspective we felt that the marriage of these two pieces coming together made absolute sense and that a lot of synergy from that would be forthcoming.”
The deal is not exclusive. Nokia’s Fran Heeran Senior Vice President & General Manager of Core Networks, Cloud and Network Services, said that where customers want a fully integrated solution, which he said would be a common scenario, then the solution going forward will be Nokia plus Red Hat. For those situations where the operator makes separate choices in terms of infrastructure – including hyperscalers and public cloud choices – then Nokia “will be fully supporting deploying [our] applications on those other platforms as well”. (Red Hat’s Darrell Jordan-Smith also pointed out that Red Hat’s OpenShift container platform can also be deployed natively within AWS, Microsfot Azure and Google Cloud environments.)
With the market evolving that way, it was very important that we had a technology offering as part of our full stack solution and core network that allowed customers to take that horizontal approach
Heeran said, “What what our customers have been doing is essentially building vertical, albeit virtualized and cloud native, instances or stacks for the different network functions. We’re seeing a change in that market now where customers increasingly want to build a horizontal solution to a standard architecture, and a standard cloud infrastructure, for all applications coming from all suppliers into their network. That’s not a market that Nokia was pursuing. We were very clear for a long time that we were very focused on cloud infrastructure supporting our own applications with some third party elements as well. But with the market evolving that way, it was very important that we had a technology offering as part of our full stack solution and core network that allowed customers to take that horizontal approach.
“Looking at Red Hat technology we felt that was an extremely good fit. And another key is that Red Hat was willing able to provide long term support for our existing customers on our existing portfolio, while the transitions and the natural evolutions happen. Maintaining that support and that continuity for existing customers was something that Red Hat were very willing and prepared to offer that was not prevalent elsewhere.”
So for suppliers like ourselves… it’s become a difficult landscape to support. I think at Nokia we do a very good job of it but obviously there’s going to be a finite limit to how many options we’re going to be able to support.
Following a question from TMN, Heeran agreed that the deal is a recognition that supporting the full vertical cloud stack within an operator business is becoming increasingly difficult for telco vendors, such as Nokia. That’s because any vendor has to support full lifecycle management across a range of different hardware and cloud environments.
“I’m quite passionate on this topic and I speak very openly about this. And this is also why this agreement is very important for where we see the market going. There’s a lot of choice. There’s a lot of choice on hardware. A lot of choice now on cloud infrastructure. And particularly, we’re now between two generations of technology as well. So we still have the virtual world – the VNF landscape is still probably the most deployed landscape right now in telco – and then obviously everyone’s looking to move over time to CNFs.
“So for suppliers like ourselves… it’s become a difficult landscape to support. I think at Nokia we do a very good job of it but obviously there’s going to be a finite limit to how many options we’re going to be able to support. I think that’s why partnering with Red Hat as a market leader in the platform that they build was really important.
“But then there’s going to be demand to have an openness flowing on third parties. I would like to see the landscape getting a little bit simpler, and having a little bit less choice. But right now, I think it’s going in the opposite direction. And you know, eventually something will have to settle down and mature – and that’s kind of also what played into our thinking. This relationship with Red Hat was a drive towards that simplicity, of being able to focus on a smaller number of platforms, but also be able to deliver exactly what our customers want. So, so yes, it’s difficult.”