Intel Pulls Out of OpenStack Effort It Founded with Rackspace

April 14, 2017, 11:28 PM UTC

Intel has cut funding for an effort it launched two years ago with Rackspace to encourage the use of OpenStack software technology by big business customers that want more flexible and cheaper data center infrastructure.

The two companies announced the joint effort, called the OpenStack Innovation Center, in July 2015. A source close to the effort said initial funding was supposed to last through 2018, but Intel pulled it early.

Intel and Rackspace disclosed the decision internally on Tuesday, the source said.

An Intel (INTC) spokesman confirmed that it has “decided to conclude its participation” in the project, but that it and Rackspace are proud of the accomplishments the teams have made. Intel and Rackspace, he added, will continue to contribute to and work with the OpenStack developer community.

A Rackspace spokeswoman said “OSIC’s objective was to create the world’s largest OpenStack developer cloud and develop enterprise capabilities within OpenStack. It quickly accomplished the first goal, and has made great progress toward the second.”

OpenStack is an open source set of software tools that companies can use to build their own cloud infrastructure. When it launched seven years ago, OpenStack was pitched as an alternative to VMware (VMW) software running in corporate data centers and Amazon (AMZN) Web Services, which offers shared public cloud infrastructure that many companies use.

Get Data Sheet, Fortune’s daily technology newsletter.

A source close to Rackspace, who requested anonymity because he is not authorized to speak about the matter publicly, said some 30 Rackspace employees who had been working at the innovation center have been given two weeks to find new jobs at the San Antonio-based company.

This is bad news for OpenStack, which has seen other vendors cut support in recent years. Hewlett-Packard Enterprise (HPE) and Cisco (CSCO) both pulled back on their OpenStack projects and laid off OpenStack-related staff over the last six months. Mirantis has also eliminated staff focused on OpenStack during that period.

This latest news comes a month before the annual OpenStack Summit tech conference is to take place in Boston.

Note: (April 15, 2017 7:36 a.m.) This story was updated to add comment from Rackspace.

Read More

Artificial IntelligenceCryptocurrencyMetaverseCybersecurityTech Forward