IBM acquires Red Hat, but not (exactly) for open source

You don’t normally expect a Jim Whitehurst LinkedIn update to hit you over a cuppa at 7am on a Monday morning.

Whitehurst is CEO of commercially supported open source enterprise Linux operating system Red Hat Enterprise Linux (RHEL) company Red Hat.

The Red Hat CEO’s update stated that IBM has now announced the acquisition of Red Hat for US$190.00 per share in cash, representing a total enterprise value of approximately $34 billion.

Did IBM need more open source then?

Well, Red Hat obviously has open source in oodles — the company’s RHEL is joined by other significant products including Ansible, JBoss Enterprise Application Platform (or JBoss EAP), Fuse and Red Hat OpenShift Container Platform… to name a few highlights.

So is this the light that drew IBM to the fire? Answer: no… and a bit yes.

IBM has a wide variety of open source projects and initiatives, has been a key players in helping to ‘save’ Linux over the years and is the originator of the Eclipse Integrated Development Environment (IDE) used extensively for Java programming.

It’s more to do with IBM’s desire to become more than just the ‘stuff old company that does a lot of mainframe stuff’ and be a more expansive player in the hybrid cloud market, a space that Red Hat excels in with a product set that (once combined with IBM’s) make the planet’s biggest hybrid multi-cloud provider.

Both Red Hat and IBM are traditionally active (some would say strong) in significant hybrid cloud technologies such as Linux, containers, Kubernetes, multi-cloud management — they also both work openly (some would say vibrantly and successfully) in the cloud management and automation space.

Will it be a case of hands off or hands on?

IBM says that Red Hat will now join IBM’s Hybrid Cloud team as a distinct unit, but that there is a focus on ‘preserving the independence and neutrality’ of Red Hat’s open source development heritage.

Computer Weekly author Tim Anderson says that, “My own instinct is that we will see more IBM influence on Red Hat, than Microsoft influence on GitHub, to take another recent example of an established tech giant acquiring a company with an open source culture.”

IBM CEO Ginni Rometty thinks the deal is a game-changer, well, she would, wouldn’t she?

“It changes everything about the cloud market. 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,” said Rometty.

Whitehurst meanwhile says that open source is the default choice for modern IT solutions, well, he would, wouldn’t he?

“Joining forces with IBM will provide us with a greater level of scale, resources and capabilities to accelerate the impact of open source as the basis for digital transformation and bring Red Hat to an even wider audience – all while preserving our unique culture and unwavering commitment to open source innovation,” said Whitehurst.

Red Hat will now also get access to IBM’s professional (some would say expansive) sales network, so there is an argument to say the we could see (even) wider proliferation of open source technologies across world enterprises. So IBM did have an open source eye open, but not quite as much as it has a hybrid cloud focus in mind. Either way, bring it on.

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