IBM is acquiring Red Hat for $34 billion

[HolyK]

Wow ...

IBM has struck a deal to acquire the cloud software company Red Hat for $34 billion.

IBM will pay $190 a share for the software company, which it described as the world's leading provider of open-source cloud software, a premium of more than 60% from Red Hat's closing stock price of $116.68 on Friday. Shares traded upward of $175 in June, but disappointing earnings combined with a volatile market to see the price drop sharply.

More at businessinsider.com

“The acquisition of Red Hat is a game-changer. It changes everything about the cloud market,” said Ginni Rometty, IBM Chairman, President and Chief Executive Officer. “IBM will become the world’s #1 hybrid cloud provider, offering companies the only open cloud solution that will unlock the full value of the cloud for their businesses.

More at redhat.com

https://www.redhat.com/en/about/pre...-and-becoming-world’s-1-hybrid-cloud-provider

 

[jgreco]

I guess that'd be more impressive if I saw more places using RHEL. This reminds me of Sears buying Kmart a decade ago, two has-beens with at least moderate potential, but unlikely to find the necessary clues to pull it all together.

 

[Chris Moore]

Wow ...

I think that might be an understatement. I don't know if this is just bad or if it is really bad. IBM can afford to do this because they make piles of money. They make piles of money by charging massively for what they sell. RedHat wasn't free, but I imagine it will become even more expensive under IBM ownership.
IBM also doesn't have a great track record with OS for the desktop computer. Look at PC-DOS and OS2.

 

[Chris Moore]

that'd be more impressive if I saw more places using RHEL

We have between a quarter and a third of our workstations configured with RHEL. That probably only amounts to around 400 or so, which is probably more than most places, but this will have an impact for those that do use RHEL and there are a lot of servers running it, from what I have read, especially in the government where they basically only use RHEL or Windows.

 

[jgreco]

We have between a quarter and a third of our workstations configured with RHEL.

Sure, and I have a bunch of general-purpose tools that are Craftsman. Didn't really help Sears that much.

There's been lots of movement away from RedHat and towards other "free-r" versions of Linux or BSD. Cloud providers would rather avoid the licensing and lots seem to have either replaced RHEL with CentOS or gone with SLES or Debian. I just don't think it's a good move for the RHEL userbase. Of course, I've also objected to stuff like GitHub being taken over by Microsoft...

 

[Chris Moore]

Cloud providers would rather avoid the licensing and lots seem to have either replaced RHEL with CentOS or gone with SLES or Debian.

That is true and I use those other operating systems when I can, but the organization I work for has a regulatory requirement that will prevent them from using anything that is not RedHat or Microsoft. Even if the regulating body can be convinced there is a reason to change, change will likely be slow. I suppose that I am lamenting what I see in my future more than thinking what will happen in the industry.

I just don't think it's a good move for the RHEL userbase.

I actually think it will be a bad move in the long run, which is why I mentioned OS2. IBM just doesn't have a good record when it comes to maintaining and improving an OS over time, not that I have seen.

Of course, I've also objected to stuff like GitHub being taken over by Microsoft...

I object to that too. I can't see it being a good thing for the users because Microsoft will be looking for ways to ring more profit out of it. That is the guiding principle with most business, to maximize profit.

 

[HolyK]

Well IBM missed the party where tickets to cloud train were distributed. Now they're desperately trying to catch it but failing to do so. Big Blue had to do something to powerboost themselves so they could play in cloud with the big guys. Acquiring Redhat is a logical step as the company has a lot to offer and it is not that huge/expensive. Now the question is if the hybrid-cloud will really catapult IBM/Bluehat to the sky or if someone will fuck this up (again)...

 

[Arwen]

Two things;

1. A little birdie told me that IBM is letting some contract staff go, in order to save money in 4th quarter. (For buying RedHat?)
2. IBM has a serious interest in RHEL on Power servers. This allows them to sell Linux on virtual capable hardware, and eventually sell AIX on the same hardware.

IBM's claim to keep RedHat separete is likely true in the short run.

Of course, I don't know where Big Purple, (Blue+Red), will go in the long run.

 

[Stux]

Big Purple, (Blue+Red)

 

[Chris Moore]

Since it is IBM, would it be more like this?

 

[rvassar]

Well IBM missed the party where tickets to cloud train were distributed. Now they're desperately trying to catch it but failing to do so.

I work in the Cloud space these days. Having done some performance analysis of various Cloud vendors, including Softlayer... I'd say they didn't just miss the party... Spinning up a simple VM in Softlayer via their RestAPI can take anywhere from a minute or two to 2+ hours... It seems to depend on someone's coffee break schedule, and at times has felt like they had a janitor installing an OS from DVD on a physical machine...

That said, most of the non-govt. RHEL deployments I've seen have a few actual RHEL licenses with support contracts, and hundreds if not thousands of CentOS instances. Ubuntu is quite popular as well.