When in Beijing: Mirantis and UCloud form Chinese OpenStack company

When IBM agreed to let the Chinese government have a look at some of its source code in a secured room under tight security, the OpenStack Foundation’s Mark Collier tweeted, “Full disclosure: we let the chinese government view the OpenStack source code in any room they want.” It was a joke, of course, but the Chinese government is serious about open source in general, and OpenStack in particular. In fact, cloud computing is part of the country’s 12th five year plan, and in December, 2014, the Ministry of Industry and Information Technology (MIIT) officially recommended that State Owned Enterprises (which make up a good portion of the Chinese economy) look at OpenStack for their cloud projects.

Not that foreign companies can just swoop in and take over the Chinese OpenStack market — though they certainly do try. As the OpenStack Summit opened in Tokyo this week, Mirantis announced a different strategy: the company will partner with China’s largest public cloud hosting provider, UCloud, to create an entirely new entity owned (roughly) equally by the two companies.  

“To be able to succeed there you really need to have a local company, a local brand and local people,” Mirantis co-Founder and CMO Boris Renski told ZDNet. “A branch of a foreign company in China is not nearly as likely to be successful as a local Chinese company run by local people, registered in China and owned by the local Chinese-affiliated folks,” he said.

Mirantis already has half a dozen customers in China, including the Shenzhen Stock Exchange and Huawei. These customers will move over to UMCloud, along with Mirantis’ 15 or so employees and a similar number from UCloud, enabling the new company to hit the ground running.  “As the world’s number one OpenStack pure-play vendor, Mirantis is the open cloud technology leader with deep and rich Openstack deployment success over many years in many different enterprise production environments,” said Xinhua Ji, CEO of UCloud and CEO of the new joint venture with Mirantis, UMCloud. “As the largest independent public cloud service provider in China, UCloud deeply understands customer requirements for cloud computing in China. Our combined strength will allow UMCloud to become the foundational technology provider for China’s Internet Plus Initiative, providing the most reliable, secured, and stable OpenStack-powered cloud service to China enterprises.”

UCloud, which has received $160 million in venture capital funding, is pushing to not only expand into the Chinese enterprise space, but also into economies outside of China. The company has data centers in China, Hong Kong, and the US, and specializes in hosting and cloud services for clients in various industries such as e-commerce, gaming, mobile internet, and SaaS, among others.   

The new company will focus on selling subscriptions for Mirantis OpenStack, as well as OpenStack services, training, and certification — areas where Mirantis excels. So where does UCloud come in?  “Now that we’ve done a joint venture,” Renski said, “a lot of the work related to building that business in China is really going to be driven by the UCloud team. That’s the whole premise behind it. It’s going to be hands off for us. Naturally, we’re going to be involved but most of the day-to-day business running is going to be done by them.”

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