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Is the sun shining brightly on Red Hat's cloud plans? Two deals offer hints.

Red Hat is focusing heavily on cloud computing operations during this year's Red Hat Summit in San Francisco.
Red Hat is focusing heavily on cloud computing operations during this year's Red Hat Summit in San Francisco. cseward@newsobserver.com

Red Hat's strategy these days revolves around making it easier for customers to set up back-end software systems that can operate simultaneously on their in-house data clouds and the public cloud services of industry players like Microsoft, Google and Amazon, company leaders say.

The "hybrid cloud is not only a reality, it's the driving model in enterprise computing today," Paul Cormier, Red Hat's president for products and technologies, said Tuesday at the kickoff of the annual Red Hat Summit, which is taking place this week in San Francisco.

Red Hat's using the conference/trade show to announce updates and additions to its software offerings, along with some company-to-company deals it thinks will further its strategy. The highlights of Day One included agreements with IBM and Microsoft.

The two deals promote the use of Red Hat's cloud-management software, OpenShift, to install and manage applications on Microsoft's and IBM's cloud-computing services.

Many of IBM's own products, including its venerable Db2 database package, are gaining operability within the OpenShift. said Mike Ferris, the Red Hat vice president for technical business development and business architecture.

Meanwhile, Red Hat and Microsoft are joining forces to make OpenShift available as an option for running systems on Microsoft's Azure platform.

There, it will be "jointly engineered, operated and supported" by both companies so customers have "in all respects a native Azure service" when it comes to updates, billing and support, said Brendan Burns, the Microsoft engineer who explained the deal for the Seattle firm.

Red Hat, headquartered in downtown Raleigh, helps develop the Linux operating system and other open-source software packages and makes money by helping other businesses put them to use.

It's not a company like Apple that puts products directly in the hands of the consumer. Rather, its software and expertise fuels the back-end systems companies like Hilton and government agencies like the Federal Emergency Management Agency rely on to get things done.

Worldwide, Red Hat employed about 11,870 people as of the end of February. In fiscal 2017-18 it netted $258.8 million in profit from about $2.9 billion in sales of software subscriptions, training programs and other services, according to its most recent annual report.

The 25-year-old company's historic focus on Linux once made it a niche player, but Cormier noted that "open source and Linux-based computing is now an industry norm."

Conference presenters from Red Hat stressed that the company's "hybrid cloud" strategy reflects the reality that big companies often need to work with multiple cloud services, if only because they have the potential of generating so much work at once that a single cloud system can't easily handle it.

And they tried to show that it's relatively easy to set up a new service, particularly if would-be customers are switching from the offerings of Dell Technologies subsidiary VMWare.

The focus on migrating applications from one service to another comes because "we've more and more seen customers" asking for such help, Cormier said, adding that Red Hat has developed a consulting practice around helping with such swaps.

As for Google and Amazon's cloud platforms, Cormier was cagey. "We're talking to partners all the time," he said, adding that he suspects "we'll have more to come" by the time next year's Red Hat Summit rolls around.

Ray Gronberg: 919-419-6648, @rcgronberg

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