QTS Launches Public OpenStack Cloud

QTS Realty Trust has added an OpenStack cloud to its arsenal of services, launching a public Infrastructure-as-a-Service cloud in one of its data centers on the East Coast powered by Canonical’s OpenStack distro. QTS and Canonical will also build private OpenStack clouds in any of QTS’s data centers for customers that need them.

Until recently, QTS has provided public and private IaaS cloud based on VMware only. With the addition of OpenStack capabilities the company is going after customers that are building cloud-native applications whose IT teams are more DevOps-oriented, Jon Greaves, CTO of QTS, told Data Center Knowledge in an interview.

These customers gravitate toward public cloud and often need a private-cloud element in their environment as well. Generally, they prefer that private cloud bit to be based on OpenStack rather than VMware, since many of the DevOps tools they use, tools that enable continuous integration and delivery, support OpenStack.

Customers choosing QTS’s VMware-enabled cloud services are usually more traditional enterprise IT shops looking to consolidate their on-prem environments and leverage their existing investments in VMware licensing, Greaves explained.

Two Types of Data Center REITs

There are essentially two types of data center REITs: ones that provide services beyond the basic data center space, power, cooling, and connectivity, and ones that don’t. QTS falls in the former category.

The ones that don’t provide those services themselves ensure they have plenty of other companies inside their facilities that can provide them to their customers, acting as middlemen and operating sophisticated platforms to enable this exchange of services.

Basically, the more relationships a customer has inside your data center with companies other than yours, the harder it is for them to leave, so the two strategies for enabling these relationships achieve similar goals. One is obviously more costly than the other, but it also makes the amount of revenue a provider can squeeze out of every kilowatt of data center capacity higher.

QTS is one of only two of the six publicly traded US data center REITs that provide those higher-level services themselves. The other one is CyrusOne, but its portfolio of higher-level services is much smaller than QTS’s. Another three REITs (Digital Realty Trust, Equinix, and CoreSite Realty) rely exclusively on partnerships with service providers, while the remaining one, DuPont Fabros Technology, has chosen to focus strictly on its bread-and-butter wholesale data center capacity product.

See also: Why QTS Expects to Win Where DuPont Fabros Failed

Provider and Middleman

The two models aren’t mutually exclusive, at least in the sense that the companies that provide services up the stack also act as intermediaries between their customers and other service providers. That’s the approach QTS has taken, also adding to the mix managed services, which is a capability it expanded greatly last year by acquiring Carpathia Hosting, a managed hosting heavyweight where Greaves served as CTO prior to the acquisition.

Read more: Why QTS Dished Out $326M on Carpathia Hosting

The latest project, for example, is to roll out managed services for Amazon Web Services, expected in the fourth quarter, Greaves said.

Two Public IaaS Regions, Custom Private Cloud Hardware

The public OpenStack cloud is already live in the East Coast data center, and the company plans to launch a second availability region on the West Coast sometime in the near future. Greaves declined to name the specific data centers on either coast. QTS operates data centers in New Jersey and Virginia on the East Coast and in Sacramento, Silicon Valley, and Phoenix on the West Coast.

The company is offering a lot of hardware customization for private OpenStack clouds it plans to build for customers, be it optimization for CPU- or memory-intensive workloads or environments that rely heavily or exclusively on SSD storage. One customer that’s already signed on for the private cloud product is a fabless semiconductor designer, for example, that needs a high-memory environment to run chip simulations.

Integrated but Flexible

Many QTS customers build their environments using a mix of QTS services, be they wholesale or custom data center space, retail colocation, or cloud and managed services. More than 50 percent of existing customers use more than one service at the company’s facilities, Greaves said.

QTS’s strategy revolves around an integrated platform that provides customers with flexibility to deploy any of the service options it provides. So far, “the message seems to resonate well,” Greaves said.