Open Compute Project as a lower cost model, Rackspace and Facebook

Rackspace and Facebook are on the board of the Open Compute project.  SeekingAlpha has post on the open source process both of these companies embrace.








The author drills to the bottom line of why Open Compute?  lower costs.

Strip away its adherence to the open source ethos, after all, and Rackspace is just a hosting vendor, no different from hundreds of other small hosting companies like Westhost or SoftLayer. At some point this competition will come down to costs, as usage of the resource scales exponentially. Low cost infrastructure will win.

Right now costs are not the key issue in the cloud. Right monetization is the issue. That's why every vendor – from Oracle (ORCL) to Dell (DELL) to Apple (AAPL) – can call what they do “cloud.” But as usage increases 10 times, then 100 times and 1,000 times, what seem like small differences in costs now will become magnified into big differences in profitability.

One way to look at Open Compute Project is it is an effort to build a lower cost data center ecosystem.

Open source, and the Open Compute project, put Rackspace at the forefront of these changes. They are key to its long term survival.