Four Takeaways from IBM’s Acquisition of Red Hat
The most significant tech acquisition of 2018 was IBM’s acquisition of Red Hat.
Red Hat is the world’s leading provider of enterprise open source software solutions, using a community-powered approach to deliver reliable and high-performing Linux, hybrid cloud, container, and Kubernetes technologies.
Here are the top-four takeaways of this unprecedented acquisition.
Takeaway 1: IBM is now the world’s top hybrid cloud provider
“The acquisition of Red Hat is a game-changer. It changes everything about the cloud market,” says Ginni Rometty, IBM Chairman, President and Chief Executive Officer. “IBM will become the world’s number-1 hybrid cloud provider, offering companies the only open cloud solution that will unlock the full value of the cloud for their businesses.”
Most businesses today are only 20% down their cloud journey. They rent compute and storage power in the cloud, primarily to cut costs. The next 80% of the cloud journey is all about unlocking real business value and driving growth.
This is the next chapter of the cloud, and IBM’s purchase of Red Hat puts IBM at the forefront of shifting business applications to hybrid cloud, extracting more data and optimizing every part of the business, from supply chains to sales.
Takeaway 2: The future of cloud is open source
Around 80 percent of business workloads have yet to move to the cloud, held back by the proprietary nature of today’s cloud market. This prevents the portability of data and applications across multiple clouds. It also complicates data security in a multi-cloud environment and makes consistent cloud management difficult.
With this acquisition, IBM has demonstrated its commitment to Red Hat’s open governance, open-source contributions, participation in the open-source community and open-source development model.
“Open source is the default choice for modern IT solutions, and I’m incredibly proud of the role Red Hat has played in making that a reality in the enterprise,” says Jim Whitehurst, Red Hat’s President and CEO.
Between them, IBM and Red Hat have contributed more to the open-source community than any other organization. IBM and Red Hat remain committed to the continued freedom of open source through such efforts as Patent Promise, GPL Cooperation Commitment, the Open Invention Network, and the LOT Network.
Takeaway 3: The future is hybrid multi-cloud
IBM and Red Hat are now strongly positioned to accelerate hybrid multi-cloud adoption. Together, they aim to help their clients create cloud-native business applications more quickly, and drive greater portability and security of data and applications across multiple public and private clouds.
And they aim to do this with consistent cloud management. They plan to draw on their shared leadership in key technologies, such as Linux, containers, Kubernetes, multi-cloud management, and cloud management and automation.
“IBM is committed to being an authentic multi-cloud provider, and we will prioritize the use of Red Hat technology across multiple clouds,” says Arvind Krishna, Senior Vice President, IBM Hybrid Cloud. “In doing so, IBM will support open source technology wherever it runs, allowing it to scale significantly within commercial settings around the world.”
Takeaway 4: Red Hat is still Red Hat
The Red Hat developer community is happy to know that Red Hat is operating as a distinct unit within IBM’s Hybrid Cloud team.
By joining forces with IBM, Red Hat has gained a greater level of scale, resources, and capabilities to accelerate the impact of open source as the basis for digital transformation—while preserving its unique culture and unwavering commitment to open source innovation.
Red Hat is part of IBM’s Hybrid Cloud team as a distinct unit, preserving the independence and neutrality of Red Hat’s open source development heritage and commitment, current product portfolio and go-to-market strategy, and unique development culture.
Red Hat will continue to be led by Jim Whitehurst and Red Hat’s current management team. Jim Whitehurst also will join IBM’s senior management team and report to Ginni Rometty. IBM intends to maintain Red Hat’s headquarters, facilities, brands, and practices.
“IBM’s commitment to keeping the things that have made Red Hat successful—always thinking about the customer and the open-source community first—makes this a tremendous opportunity for not only Red Hat but also open source more broadly,” says Paul Cormier, President, Products and Technologies, Red Hat. “Since the day we decided to bring open source to the enterprise, our mission has remained unchanged. And now, one of the biggest enterprise technology companies on the planet has agreed to partner with us to scale and accelerate our efforts, bringing open source innovation to an even greater swath of the enterprise.”
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