IBM wants to acquire Red Hat for 34 billion dollars. This makes it the company's largest purchase to date. According to Arvind Krishna, Head of IBM Research, the biggest motivation for the acquisition was to win over the hybrid cloud market.
In this way, they want to help customers in the future to establish hybrid cloud environments in their companies and to use them profitably.
"Customers need the right technology for open source applications, and together Red Hat and IBM can deliver it to them"
says Krishna.
Justified doubts
"The financial dimension of the deal is enormous"
Stefan Ried, Principal Analyst and IoT Practice Lead at Crisp Research, writes in his blog post. "IBM swallows Red Hat and risks its future".
"IBM wants to have the largest market share in the hybrid and public cloud market. This requires investment not only in infrastructure, but also in the software stack.
But the deal is more reminiscent of the eleven billion dollars for which Hewlett Packard bought Autonomy in 2012. Billions in loss write-offs in the years that followed brought HP to its knees and marked the beginning of the breakup of the traditional company."
The concern expressed here is on the minds of many IBM customers: Has IBM overstretched itself with this acquisition? Or will the company manage to take over Red Hat without serious losses?
The future is uncertain, and opinions differ. More at crisp-research.com/ibm-swallows-red-has-and-risks-its-future..
Open Source: Basis for Digital Transformation
Red Hat expects more reach and more resources from the cooperation with IBM. Thus, Red Hat could make its products accessible to the broad masses and establish open source as the basis of digital transformation.
Together, the two companies aim to help their customers move their business applications to the cloud and adopt a hybrid cloud strategy.
They also want to make cloud-native business applications faster and easier to transfer and ensure the security of data and applications in the cloud.
IBM and Red Hat both stressed that this acquisition is merely the next step in a long-standing partnership and that Red Hat will not change.
Paul Cormier, executive vice president of Red Hat, commented:
"Our company culture, where we try to be open to discussion and innovation from customers, will not change. We will also maintain our partnerships with AWS, Google Cloud and more. In terms of our customers and partners, we will remain neutral."
Red Hat will join IBM's hybrid cloud team as a separate entity. This is to preserve Red Hat's independence.
Arvind Krishna explains:
"That Red Hat remains a separate entity is important to us. On the one hand, because Red Hat's open corporate culture is unique and appreciated by customers worldwide. On the other hand, again because we want to separate business. Red Hat should be able to support its customers completely independently of IBM."
Red Hat will continue to be led by Jim Whitehurst and current management. In addition, Red Hat's headquarters will remain in the United States, and the two companies' products will continue to be offered largely separately.
What the deal means for existing SAP customers who use the Hana database with hardware from IBM and Suse Linux is uncertain. Only the next few years will show whether Red Hat Linux will now replace Suse as a result of the close cooperation with IBM.
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