Mergers and acquisitions were aplenty in 2018. In addition to the usual buying and selling, companies also began to snap up open source players like GitHub, Heptio, and Red Hat.
First announced in June, Microsoft completed the $7.5 billion acquisition of GitHub in October. Microsoft CEO Satya Nadella stressed that GitHub will operate independently under Microsoft’s cloud business. Nat Friedman, the former CEO of Xamarin, a software company bought by Microsoft in 2016, was named CEO of GitHub. Friedman will report to Scott Guthrie, Microsoft cloud and AI group EVP.
While most analysts supported the deal, it was met on social media with concern for how the deal would impact the open nature of GitHub. A few of these concerns pointed out other software acquisitions such as Hotmail and Skype that commenters claimed Microsoft had “ruined.”
Jim Zemlin, the executive director of the Linux Foundation, which houses a lot of its open source code through GitHub, told SDxCentral that while he understood the mistrust of Microsoft, he thought it was “pretty good news for the world of open source.” Zemlin also noted that Kubernetes and Node.js, both in the Linux Foundation family and developed on GitHub, would remain under the ownership of the project copyright owners, not Microsoft.
IBM Buys Red Hat
In October IBM announced its intent to purchase Red Hat for $34 billion. The purchase is meant to boost IBM’s ability to compete in the hybrid cloud and container markets.
Red Hat will maintain its independence and neutrality but will become part of IBM’s hybrid cloud business as a “distinct unit.” Arvind Krishna, senior vice president of IBM’s Hybrid Cloud, said that Red Hat will continue its commitments to open source and to other public cloud provider customers like AWS, Microsoft Azure, and Google Cloud.
Red Hat CEO Jim Whitehurst will join IBM’s senior management team and report to IBM President and CEO Ginni Rometty. Both boards approved the deal.
Following the announcement, there was some speculation as to what this would mean to the open source community, and how IBM will integrate with Red Hat. While some worry that IBM could snuff out the widespread innovation of Red Hat, others feel optimistic considering IBM’s proactivity with open source in the past.
Oracle’s SD-WAN Play
In November, Oracle acquired SD-WAN vendor Talari Networks. Financial terms of the deal were not disclosed.
Oracle said that Talari’s flagship technology — its Failsafe SD-WAN — will compliment its session border controller (SBC) and network management infrastructure ensuring the performance of real-time communications and applications over any network.
Cliff Grossner, senior research director at IHS Markit, told SDxCentral that as the SD-WAN market continues to expand, cloud service providers have begun to understand the importance of SD-WAN and to offer it as part of a cloud service. However, Oracle is the first cloud provider to purchase an SD-WAN vendor and bring the technology in house.
Arista Makes Its First 2 Acquisitions
Arista made its first two acquisitions this year, initially snapping up cloud-managed WiFi firm Mojo Networks and then buying Metamako, a provider of low-latency field programmable gate array (FPGA) products a month later.
Arista defended its purchase of Mojo to those who saw it as a little far afield for the data center switching company, saying that its campus customers were asking for it. The entire Mojo team of about 250 people joined Arista.
Its second purchase was Metamako, a company founded in 2013 and based in Sydney, Australia. Its flagship product MetaConnect is a configurable Layer 1 switch with a latency of 4 nanoseconds. Such low latency is nearly undetectable.
Arista will continue to ship Metamako products, specifically to Arista’s financial services and stock exchange customers. Arista did not disclose the terms of the Metamako purchase but did say “key people” from Metamako will stay with Arista.
Broadcom Snags CA Technologies
In July, Broadcom said it would buy the performance monitoring software company CA Technologies for $18.9 billion. The semiconductor company said the purchase would expand its total addressable market to include the growing infrastructure software market.
Investors and analysts questioned why the hardware company would buy a software company — particularly one that doesn’t integrate with Broadcom’s technology. Months later in its third fiscal quarter 2018 conference call, Broadcom CEO Hock Tan said that he thought Broadcom could tap into CA Technologies’ software customers to sells its switches, routers, and fiber optic equipment.
The semiconductor company closed on the deal in November. Just days later, Broadcom slashed more than 300 jobs from CA Technologies’ New York office and another 119 from its headquarters in Santa Clara, California.
VMware Boosts Kubernetes Portfolio
VMware purchased the 2-year-old Kubernetes-focused startup Heptio for $550 million. The acquisition bolsters VMware’s push into the open source ecosystem and its position outside of its traditional virtual machine (VM) focus.
Announced in November, VMware said that Heptio will merge into its Cloud Native Apps business unit.
Heptio’s founders – Joe Beda and Craig McLuckie – had both been involved at Google on its Compute Engine and the platform that eventually became the open source Kubernetes project. Both remain active in the Kubernetes community.
VMware has started a number of container initiatives as Kubernetes encroaches on its VM business. For instance, VMware in June launched its hosted Kubernetes Engine (VKE) software-as-a-service (SaaS) platform.
Analysts have noted that many enterprises are likely to run their initial container deployments on VMs due to the convenience and familiarity.
Micro Focus Sells SUSE to PE Firm
Micro Focus sold SUSE to the Swedish private equity fund EQT VIII for $2.5 billion in July. The private equity firm will operate SUSE as an independent company.
SUSE was founded in 1992, and it was the first provider of an enterprise-grade open source Linux operating system. The company provides open source software-defined infrastructure and application delivery solutions for on-premise and cloud-based workloads. It also began to dip its toes in containers and microservices last year, launching a container-as-a-service platform.
Reliance Acquires Radisys for 5G, IoT
India’s Reliance Industries acquired Radisys for about $67 million. Radisys will remain as an independent entity.
Radisys is based out of Hillsboro, Oregon, and it has an engineering team in Bangalore, India, with sales and support offices across the world. The company provides hardware, software, and services that enable the migration to next-generation networks.
Reliance Industries is the parent company of Reliance Jio, India’s upstart mobile operator, which is building a greenfield SDN network. The purchase of Radisys will help Reliance Jio with its 5G and IoT goals