DevOps.com

  • Latest
    • Articles
    • Features
    • Most Read
    • News
    • News Releases
  • Topics
    • AI
    • Continuous Delivery
    • Continuous Testing
    • Cloud
    • Culture
    • DevSecOps
    • Enterprise DevOps
    • Leadership Suite
    • DevOps Practice
    • ROELBOB
    • DevOps Toolbox
    • IT as Code
  • Videos/Podcasts
    • DevOps Chats
    • DevOps Unbound
  • Webinars
    • Upcoming
    • On-Demand Webinars
  • Library
  • Events
    • Upcoming Events
    • On-Demand Events
  • Sponsored Communities
    • AWS Community Hub
    • CloudBees
    • IT as Code
    • Rocket on DevOps.com
    • Traceable on DevOps.com
    • Quali on DevOps.com
  • Related Sites
    • Techstrong Group
    • Container Journal
    • Security Boulevard
    • Techstrong Research
    • DevOps Chat
    • DevOps Dozen
    • DevOps TV
    • Digital Anarchist
  • Media Kit
  • About
  • AI
  • Cloud
  • Continuous Delivery
  • Continuous Testing
  • DevSecOps
  • Leadership Suite
  • Practices
  • ROELBOB
  • Low-Code/No-Code
  • IT as Code
  • More
    • Application Performance Management/Monitoring
    • Culture
    • Enterprise DevOps

Home » Features » IBM Closes $34B Red Hat Acquisition

IBM Closes $34B Red Hat Acquisition

By: Mike Vizard on July 9, 2019 4 Comments

Following the official closing of IBM’s $34 billion acquisition of Red Hat today, leaders from both companies reiterated Red Hat will continue to operate independently of IBM but will leverage IBM resources to advance the hybrid cloud computing ambitions of the newly combined entity.

Recent Posts By Mike Vizard
  • TechStrongCon: Time to Build an Army of Citizen Developers
  • Buildkite Adds Analytics Tools to Identify Flaky App Tests
  • Survey Reveals High Cost of Application Modernization
More from Mike Vizard
Related Posts
  • IBM Closes $34B Red Hat Acquisition
  • How IBM’s $34B Bid for Red Hat Will Spur DevOps Adoption
  • IBM Doubles Down on Cloud, But Is Krishna an Interim CEO?
    Related Categories
  • Blogs
  • Business of DevOps
  • Features
  • News
    Related Topics
  • acquisition
  • hybrid cloud
  • ibm
  • open source
  • red hat
Show more
Show less

Arvind Krishna, senior vice president for cloud and cognitive software at IBM, said IBM and Red Hat together will be in a better position to address what he described as Chapter Two of a continuing cloud journey. With 80% of applications still running in on-premises IT environments some 10 years after the arrival of public clouds, it’s apparent hybrid cloud computing will become the dominant form of IT, he said.

DevOps Connect:DevSecOps @ RSAC 2022

Red Hat will play a critical role in helping customers achieve that goal using a common operating model based on distributions of Linux and Kubernetes container orchestration software, Krishna said. However, he added, IBM sees no need to rationalize its current middleware software portfolio, which often addresses use cases that Red Hat doesn’t.

Paul Cormier, executive vice president and president for products and technologies for Red Hat, said Red Hat will continue to invest in products and projects independently of IBM. As such, Red Hat does not expect its relationship with its partners that compete directly with IBM to change substantially, he said. At the same time, he stressed that working more closely with IBM will accelerate a 100% open source approach to hybrid cloud computing that otherwise would have taken Red Hat “many years” to execute on its own. That hybrid cloud computing strategy, in contrast to rivals, will span virtual machines, bare-metal servers and public clouds, Cormier said.

Other than introducing Red Hat to a potentially larger customer base, it’s not quite clear how being a unit of IBM accelerates the Red Hat strategy. Red Hat and IBM sales teams, for example, will have no incentives to cross-sell offerings and Red Hat will continue to promote its brand independently of IBM, in much the same way VMware operates independently of the rest of Dell Technologies. Both Red Hat and IBM also stressed there is no plan to impose an IBM culture on Red Hat or lay off any personnel. There is a consensus that open source software will play a role in enabling hybrid cloud computing that should generate opportunities for IBM to generate more professional services revenue.

Longer-term, there’s clearly an opportunity for both Red Hat and IBM to promote the adoption of a common set of best DevOps practices across a hybrid cloud computing environment. Many organizations, however, are already moving to extend those best practices across all the platforms that make up very diverse IT environments.

For now at least, organizations that have already committed to Red Hat appear to be lending their continued support. Red Hat’s fiscal year 2019 revenue was $3.4 billion, up 15% year over year. Fiscal first-quarter 2020 revenue was $934 million, up 15% year over year. Services revenue for Red Hat also grew 17%. Precisely how IBM and Red Hat intend to unlock the value of this merger beyond the momentum Red Hat already enjoys, however, remains a bit of a mystery.

— Mike Vizard

Filed Under: Blogs, Business of DevOps, Features, News Tagged With: acquisition, hybrid cloud, ibm, open source, red hat

Sponsored Content
Featured eBook
DevOps: Mastering the Human Element

DevOps: Mastering the Human Element

While building constructive culture, engaging workers individually and helping staff avoid burnout have always been organizationally demanding, they are intensified by the continuous, always-on notion of DevOps.  When we think of work burnout, we often think of grueling workloads and deadline pressures. But it also has to do with mismatched ... Read More
« CLEARLAKE CAPITAL GROUP AND TA ASSOCIATES TO MAKE A STRATEGIC GROWTH INVESTMENT IN DIGICERT
source{d} Delivers Enterprise Edition of SDLC Platform »

TechStrong TV – Live

Click full-screen to enable volume control
Watch latest episodes and shows

Upcoming Webinars

Continuous Deployment
Monday, July 11, 2022 - 1:00 pm EDT
Using External Tables to Store and Query Data on MinIO With SQL Server 2022
Tuesday, July 12, 2022 - 11:00 am EDT
Goldilocks and the 3 Levels of Cardinality: Getting it Just Right
Tuesday, July 12, 2022 - 1:00 pm EDT

Latest from DevOps.com

Rust in Linux 5.20 | Deepfake Hiring Fraud | IBM WFH ‘New Normal’
June 30, 2022 | Richi Jennings
Moving From Lift-and-Shift to Cloud-Native
June 30, 2022 | Alexander Gallagher
The Two Types of Code Vulnerabilities
June 30, 2022 | Casey Bisson
Common RDS Misconfigurations DevSecOps Teams Should Know
June 29, 2022 | Gad Rosenthal
Quick! Define DevSecOps: Let’s Call it Development Security
June 29, 2022 | Don Macvittie

Get The Top Stories of the Week

  • View DevOps.com Privacy Policy
  • This field is for validation purposes and should be left unchanged.

Download Free eBook

Hybrid Cloud Security 101
New call-to-action

Most Read on DevOps.com

What Is User Acceptance Testing and Why Is it so Important?
June 27, 2022 | Ron Stefanski
Rust in Linux 5.20 | Deepfake Hiring Fraud | IBM WFH ‘New No...
June 30, 2022 | Richi Jennings
Chip-to-Cloud IoT: A Step Toward Web3
June 28, 2022 | Nahla Davies
DevOps Connect: DevSecOps — Building a Modern Cybersecurity ...
June 27, 2022 | Veronica Haggar
The Two Types of Code Vulnerabilities
June 30, 2022 | Casey Bisson

On-Demand Webinars

DevOps.com Webinar ReplaysDevOps.com Webinar Replays
  • Home
  • About DevOps.com
  • Meet our Authors
  • Write for DevOps.com
  • Media Kit
  • Sponsor Info
  • Copyright
  • TOS
  • Privacy Policy

Powered by Techstrong Group, Inc.

© 2022 ·Techstrong Group, Inc.All rights reserved.