Cloud Flash: Riverbed Buys Zeus

July 23, 2011 Leave a comment

When it comes to Cloud computing, the “Innovators Dilemma” is dead as either companies transform themselves to tackle new challenges or die a slow death.  Verizon buys Terremark, Time Warner Cable buys NaviSite, Microsoft buys Skype, VMware “buys” Mozy, and more.  With the pace of innovation and change at record speed and accelerating, there is no longer time to debate the pros and cons of innovation.  The Deep Pockets of Legacy Software/Hardware/Service Providers = the Key to the Survival.  Really?  Microsoft is buying their way into the mobile space enticing developers to build applications for Windows 7 Mobile with cold hard cash.  Cisco is financing purchases via Cisco Capital Finance.  Now, Riverbed is buying their way into Cloud computing by purchasing Zeus.  Riverbed manages and optimizes datacenter and endpoint traffic while Zeus does the same for Cloud computing traffic.  Rather than revamp Riverbed’s technology for the Cloud, it’s simply easier to purchase.  In essence, the “Innovators Dilemma” has become the Integration Dilemma.

Given Riverbed’s success with their acquisition of Mazu Networks and CACE Technologies of Wireshark fame, I have no doubt that they have hit another home run the with the acquisition of Zeus.  I expect the Riverbed to successfully integrate Zeus’ technology across their entire product line while disrupting a market segment that they helped create.

Filed under Cloud Computing, M&A Tagged with , , , , , , , , , ,

VMware Acquires Shavlik: Where Has The Innovation Gone?

May 16, 2011 1 Comment

VMware has agreed to acquire Shavlik Technologies; the terms of transaction were not disclosed.  Shavlik was founded in 1993, is headquartered in Minnesota, and offers a full suite of products to manage physical or virtual servers and laptops/desktops.  Shavlik is no stranger to VMware as the companies jointly developed VMware GO, a SaaS based IT management offering.

While Shavlik is an excellent acquisition for VMware as their technology is solid and they are sure to grow faster under VMware’s umbrella, the question is why?  VMware paints this acquisition as a way to increase their penetration within small and medium business (SMB).  Mark Shavlik, President and CEO, writes via his blog, “We will also be entering global markets much faster by working with Managed Service Providers (MSPs) and Solution Providers. This enables more companies around the world to utilize our SaaS and On-Premise solutions.”  If Shavlik’s solution can scale to meet the needs of MSPs and Solution Providers, then is it really simply a SMB solution?

Perhaps it’s just me, but this whole thing seems a bit scripted for my taste.  From the press release to the blog post to the media coverage, it feels a bit like listening to politicians running through their talking points.   In an effort to shield themselves from the wrath of traditional IT management companies such as Symantec, HP, LANDesk, and IBM, Is VMware intentionally downplaying Shavlik’s capabilities?  After all, VMware has acquired a company that has full management capabilities including antivirus, patch management, configuration management, asset management, and power management.

At a time when VMware’s Enterprise dominance is being challenged by both Microsoft and Red Hat, Shavlik looks to be a defensive acquisition to protect the lower end of the market.  However, how many people have heard about VMware Go prior to this acquisition?  Will VMware roll Shavlik’s products into Ionix rationalizing the overlap with Configuresoft?   Does this help VMware with Hybrid Clouds?  Public Clouds?  Workloads?

More importantly, has VMware become so large that they have lost the ability to innovate and disrupt a market that they created?  This is not VMware’s first acquisition from their 3rd party partner ecosystem, and I suspect it is not their last.  VMworld 2011 is certainly going to be interesting!

Filed under Cloud Computing, M&A Tagged with , , , , , , , ,

Dell Avoids Aster and Dodges a 296 Million Dollar Mistake

March 4, 2011 Leave a comment

Another one bites the dust as Teradata has acquired Aster Data for a reported $263 million.  This represents 89% of Aster Data shares as Teradata already owned 11% of Aster bringing the true acquisition cost to $296 million or $275 million after subtracting Aster’s $21 million in cash.  In any case, that’s a lot of money for a company of Aster’s age and size.

For Teradata this acquisition makes sense as they continue to compete against HP (Vertica), IBM (Netezza), EMC (Greenplum), Oracle, and SAP (HANA).  Teradata is faced with an age-old question for technology companies; hold on to their proprietary ways of the past or reach for the open and commoditized ways of the future.  It is not clear to me which direction Teradata will choose. However, it is clear to me that, unlike Dell, Teradata is the right company in the right industry to make such a gamble on Aster; the database guru’s at Aster, Tazo Argyros and Mayank Bawa, will find themselves at home within the halls of Teradata.

While I applaud Dell for continuing to blaze their own path, it seems others within the technical community are harder to please.  Per Gigaom’s Stacey Higginbotham’s article posted on March 3, 2011:

“So for Dell, and any other big data wannabes out there, the only proven options left to
start fulfilling this niche are ParAccel, Infobright, and Ingres’s VectorWise Platform.”

I’d hardly call Dell a “big data wannabe” and perhaps some have misconstrued their attempted acquisition of 3Par as a precursor to Dell entering this space.  In fact, Dell has been quite clear that any software acquisitions must have an impact on their strategic lines of business.  While Aster and other big data start-ups have the potential of driving Dell’s server and storage sales, their valuations and competitive landscapes make them a risky move for Dell.

Dell is quickly becoming the king of “Cloud Neutrality” as they are providing key pieces of the solution to their customers while working with various infrastructure providers such as Juniper, Cisco, and more. By purchasing disruptive Cloud software companies within the areas of management, orchestration, security, and monitoring, Dell could further their leadership in this market.  Think the completion of UEC; very exciting!

Since I’ve never started a billion dollar company from my dorm room, I’ll defer to Michael Dell to make the right moves for his company.  Perhaps they’ll enter the big data market with a smaller software acquisition and integrate it into other cloud offerings thereby indirectly attacking the market.  For now, Teradata has gotten a bit stronger while Dell has avoided a $296 million mistake.

Filed under Cloud Computing, M&A Tagged with , , , , , , , , , , , ,

Note To Dell: Forget Big Data and Go For Cloud Infrastructure

February 16, 2011 1 Comment

It seems like five seconds after HP purchased Vertica, the entire world focused on Dell and their big data strategy.  This was further compounded by the fact that Dell blew out their earnings with a $15.7 Billion fourth quarter and Michael Dell suggested that they would target smaller acquisitions to help their server and storage divisions.

Speculation is rising that Dell will purchase Aster Data Systems a Stanford University start-up that is backed by Sequoia Capital.  Aster’s nCluster sports a massively parallel processing (MPP) data warehouse with integrated MapReduce that is built on commodity hardware.  Whose commodity hardware?  You guessed it, Aster partners with Dell to provide the Aster Data MapReduce DW Appliance.

However innovative and powerful Aster’s solutions are, their rumored valuations are sky high.  According to Gigaom’s article Cloud Startup Values are Getting Insane published on September 24, 2010, Aster’s valuation is rumored, “somewhere between $85 and $120 million.”  Furthermore, Aster took issue with Gigaom’s assessment saying, “The valuation you/GigaOm stated recently is more reflective of the previous B round that closed Q4 2008, and while we don’t disclose the actual valuation of the latest C round it is in fact materially greater than the Series B.” Really?  Let’s get back on track.

Dell is a remarkable turnaround story that is predicated on their decisions to blaze their own trail in the industry.  Rather than purchase network equipment or security vendors, Dell has been acquiring interesting software companies such as Scalent, Boomi, and Insite One, with a purpose or focus on the Cloud.  Why change this focus?  When you think Dell do you think database warehousing? Software?

Dell’s future growth hinges on their Data Center Solutions (DCS) and Cloud Computing.  They have two choices; make a major market disrupting acquisition or take some risks by purchasing smaller but highly disruptive software companies.  It’s no secret that I am a proponent of Dell purchasing Rackspace, even in the face of a rising market valuation and the prospects of another bidding war.  Rackspace is that good and Dell knows it.

Enough, who else should Dell purchase?  There are the obvious, Joyent, and the obscure, Nimbula.  They could lean forward, OnApp, or take a risk, Appistry.  They could choose infrastructure, GoGrid, or go a bit crazy, Marathon Technologies.  They can go services, Appirio, or go international, ElasticHosts. And on, and on, and on, …

Regardless of what path Dell chooses, Michael Dell has done one incredible job of turning and changing the course of a $60 Billion company. While some have written that Dell is “yesterday’s company”, I’d watch out as they may just surprise you and the entire industry.

Filed under Cloud Computing, M&A Tagged with , , , , , , , , , , , , , , , ,

Let the Consolidation Begin: Verizon buys Terremark

January 29, 2011 1 Comment

First, let’s have a round of applause for Verizon and their executive leadership.  Verizon has shown the ability to move beyond marketing trends to acquire ‘smart’ technology companies that address core business needs.  While others in this space have a ‘not invented here’ mentality, Verizon has no such issue.  Need proof?  Look no further than their Cybertrust acquisition in 2007.

Second, the giant smiles at Savvis, Rackspace, Hosting.com, GoGrid, and others are causing a blinding industry whiteout.  Savvis and Rackspace are both innovators and leaders in this space and are hot growth and/or acquisition targets.  These companies aren’t selling marchitecture; instead they are building unique architectures using leading-edge technologies from VMware, Cisco, EMC, Intel, and others.

Third, Amazon is the wild card in this equation.  No slighting of Amazon’s cloud prowess in this blog, as they are clearly a disruptive and growing force within the industry.  Amazon’s leadership made strategic bets before this rocket ship took off, and they are reaping the benefits of solid execution.  What remains to be seen is if Enterprises are truly ready for a Cloud or if they will demand collocation and/or dedicated server hardware, of which Amazon does not currently offer.

Finally, here we go again, it’s AT&T vs. Verizon.  Let’s not kid ourselves, Verizon’s real target is AT&T and Terremark gives them a strategic energy boost.  However, AT&T’s no slouch in the Cloud or Managed Services arenas.  AT&T offers a complete portfolio of IAAS, Cloud Storage, Co-Location, Virtualization, and Managed Services.  Furthermore, AT&T has an impressive track record of providing high quality Enterprise Class Solutions to their customers. Not to mention, AT&T has a rock-solid partnership/relationship with IBM.

One last thought, lets not forget that the Cloud depends on many physical elements such as datacenters (real estate), servers, storage, networking, security, applications, and people (talent).  As the cloud grows, datacenter growth (global) will become increasingly important.  Verizon gains on all fronts with Terremark; not to mention a healthy mix of Government and Enterprise Customers.

Let the consolidation begin and may the best valuations win.

Filed under Cloud Computing, M&A Tagged with , , , , , , , , , , , ,

NetApp Acquires Akorri: A Nice Band-Aid To A Complex Problem

January 15, 2011 2 Comments

NetApp has announced their plans to acquire Akorri Networks.  While the terms of the deal are unknown, we do know that Akorri raised over $50 million dollars in VC funding and that they have over 200 customers.  We also know that Akorri “develops cross-domain analytical software solutions that optimize performance and utilization in the dynamic data center.”

Underneath the marketing literature, Akorri plays in the crowded space of Virtualization Capacity and Performance Management with a twist; they have concentrated on storage bottlenecks within a virtual infrastructure.  Akorri supports VMware and Hyper-V as well as storage systems from NetApp, Dell, HP, IBM, LSI, EMC, and HDS.

Meanwhile, NetApp has become quite a virtualization storage powerhouse that includes FlexPod, a partnership with Cisco and VMware. Moreover, this is not NetApp’s first rodeo as they acquired Onaro, storage management software, in January of 2008.  Unlike their competitors, NetApp managed to integrate rather than deprecate Onaro’s software, as it remains very much alive within NetApp’s software portfolio branded as OnCommand Management Software (OMS).

Why does this matter?  While we are firmly within the grasps of an IT paradigm shift, there are major challenges that require both short-term band-aids and long-term solutions.  After years of hiding behind the silo’d walls of IT, storage is such an area.  Specifically, storage is becoming a major bottleneck for virtualization deployments and a major headache for traditional IT Management Frameworks.

Clearly, NetApp understands this challenge and I can only surmise that their customers are clamoring for a solution.  Although Akorri does not address the long-term challenge, they do offer NetApp a nice band-aid with the ability to extend OMS to provide their customers a view into their virtualization storage bottlenecks.  I’d expect two versions of this new solution offering both a NetApp only and an Expanded solution.

Meanwhile, it is time to address the long-term challenge of the next generation datacenter.  Virtualization is an incredible technology, but we cannot forget the physical world that includes servers, storage, networking, and security.  We cannot forget the applications, both old and new, that are the centerpiece of this revolution.  We cannot forget the dynamics of a changing world and its hunger for ‘Green’ solutions.  We cannot forget the tremendous complexities and pressures that the next-generation datacenter imposes on system engineers and their operation counterparts.

Ah, but that’s another blog post.  For now, let’s celebrate that Akorri has found a new home while NetApp has added a nice band-aid to a complex problem.

Filed under M&A Tagged with , , , , , , , , , , , , , , ,

IBM Throws a Pebble at Cisco UCS; Buys Blade Networks

September 27, 2010 Leave a comment

In the wake of increasing competition from the likes of Cisco, HP, vEMC (VMware plus EMC), IBM responds by purchasing Blade Networks.  For those who have never heard of Blade Networks, Blade was mercifully spun out of Nortel Networks and has hundreds of customers and several hardware OEM deals.  Coincidentally, I think not, Blade has been a long time partner of both IBM and IBM/Netezza.

After years of transforming themselves into a software/services company, IBM is being forced back into the networking business.   While some have postulated that “IBM has turned their back on Juniper Networks”, the reality is Juniper’s baggage may be too big for even IBM to swallow.  Additionally, IBM’s purchase of Blade Networks is a pebble across the bow of Cisco and will do little to anger one of their most strategic partners.

Blade gives IBM a converged networking fabric company while eliminating their competitors from Blade’s technology; namely HP, NEC, and SGI.  Additionally, Blade provides IBM a way to ‘dip their toe in the water’ to see if the market, customers, and partners approve of this new direction.  If IBM is truly looking to challenge UCS or Matrix, then they need additional pieces to this puzzle.

What IBM needs is a new platform ala Cisco UCS that eliminates the baggage of the original blade systems; optimized for density and space.  They must examine how to better integrate their storage platforms with their blades using FCoE and perhaps should look towards a true Multi-Hop FCoE solution.  They must revolutionize virtualization and I/O as perhaps no one else on this planet has the experience, patents, and real world deployments as IBM.  Finally, IBM has the opportunity to rethink management by acquiring, integrating, and refining their current solutions.

If IBM needs a little inspiration, then they can look to their long time bitter enemy Oracle.  While virtualization, fabrics, networking, server chassis, and storage is interesting, applications are still king.  Oracle’s vision is clear; you can run our apps on any server or virtualization platform you want, but it just runs better on Oracle.

The last time I checked, IBM is still Big Blue and they have an arsenal of technology at their disposal.  The question is  ‘if’ and ‘when’ IBM will wake from their slumber and lead the industry once again.  Aside from a blockbuster merger between IBM and Cisco, … hey, one can dream… your move Dell.

Filed under Cloud Computing, M&A Tagged with , , , , , , , , , , , ,

Apple’s Next Move; Buy Yahoo

March 29, 2010 1 Comment

It seems like only yesterday when the world wasn’t quite so complicated. When good vs. evil was as simple as Apple vs. Microsoft. With the rise of the Internet came the birth of a whole new paradigm of communicating and sharing information. Proprietary software has new open source challengers that are surprisingly refined while continuing to expand their capabilities. Client/Server gave way to Web based user interfaces and the deliver of legacy software is giving way to the cloud. The desktop has been replaced by the laptop, the cell phone became a mobile device, and Apple has become a powerful force within computing, music, video, mobile devices, and more. However, once again the world has changed and Apple must adapt to face a new challenge; Google.

Once upon a time Apple and Google were friends with a common enemy and clear boundary lines. Today, those lines have been crossed and they are headed on a collision course. Apple didn’t start this skirmish, but they did create an inflection point that has become a clear threat to Google’s future. The rise of OSX, iPod, iPhone, iTunes, and now iPad, flew in the face of Google’s Internet vision centered around their cloud. Google risked losing control of the end-user platform and the advertising revenue they covet; they had no choice but to stop Apple’s momentum. Therefore, Android, Chrome, and Chrome OS were born.

While Google is on the offensive, Apple continues to chart their own course. However, this changed when Google released the Nexus One and then snatched AdMob from Apple’s hands forcing them to settle for Quattro Wireless. This skirmish is now an old fashion feud and may escalate into an all out war. Maybe that’s why Schmidt met with Jobs last Friday to attempt to deescalate the situation, but remember that Jobs never yielded to Gates. If Apple wants to attack Google, then look no further than Yahoo as a perfect takeover target.

Apple would not be buying Yahoo for search, that’s Microsoft’s problem. Instead, Apple would be gaining a cloud and advertising platform for which they could re-launch current Yahoo services, build on Yahoo’s mobile and location based strategy, and integrate current Apple offerings. Imagine a new Yahoo that has been injected with Apple’s DNA and provided innovative services and content for Apple’s computing and mobile products. How about a cloud based iTunes Store, the merging of Flickr with iPhoto, or Time Capsule based back-up in the Cloud. I shutter to think how Apple could redefine and reinvigorate Yahoo.

Consider this, Yahoo is still the third most popular website on the United States. Yahoo’s problem has never been visitors, instead it has always been the monetization of their incredible content. Does anyone doubt Apple’s ability to introduce new and innovative business models to the market? Additionally, Yahoo’s Fire Eagle location-based service would be downright explosive in Apple’s hands.

As Jobs rightfully stated, “We (Apple) did not enter the search business. They (Google) entered the phone business.” Now is the time for Apple to take their massive following, passion, and ability to invent ground breaking intuitive technology and attack the advertising revenue that is at the heart of Google’s dominance. The centerpiece of such an attack is the purchase of Yahoo serving as a catalyst for Apple’s continued domination of the mobile space.

Filed under M&A Tagged with , , , , , , , , , , ,

Quick Alert: HP Counters Cisco with Polycom Partnership

March 22, 2010 1 Comment

In a woefully under reported story, HP has signed a global agreement with Polycom for Visual and Unified Communications solutions.  This is an important signing for HP as they continue to be on a collision course with Cisco.  While Cisco’s purchase of Tandenburg was a coup, many outside the industry had to research the company and their products.  Polycom is a different story, as it feels like their equipment is found in just about every conference room across the globe.

Per Polycom’s press release, “Under the expanded agreement, Polycom video and voice solutions for unified communications and stand-alone operation will be sold and delivered through HP as part of the company’s Unified Communications and Collaboration Services portfolio. This will enable organizations to leverage HP’s global presence for evaluating, designing, implementing and supporting communications systems that deliver a consistent, high-quality experience between all locations to ensure maximum benefits and rapid return on investment. The companies will also deliver interoperability between Polycom’s line of standards-based telepresence and video conferencing solutions and HP Halo telepresence.”

Translation, we’re going to kick Cisco’s butt by leveraging our customer relationships, services division, and powerful sales channel.  We may have lost LifeSize to Logitech, but we aren’t going to lose Polycom to anyone. Hello, IBM, are you watching this?

Additionally, Polycom announced an expanded partnership with Microsoft.  They are going to jointly develop and deliver “an extended portfolio of unified communications solutions.  Why is this important?  Since Cisco is aligned with EMC/VMware for their UC platform, HP is indirectly playing their trump card in Microsoft.  Who has a stronger relationship with Microsoft; Cisco or HP?

If the partnership between HP and Polycom takes-off, then I’d expect Michael Hurd to open the M&A wallet once again.  After all, HP must counter Cisco’s moves.

Filed under Cloud Computing, M&A Tagged with , , , , , , , , , , , , ,

Quick Alert: CA Hits a Homerun and Acquires Nimsoft

March 10, 2010 1 Comment

After a string of questionable acquisitions, CA hits a homerun by acquiring Nimsoft for a cool $350 million.  Nimsoft is a pioneer of “Unified Management” and an emerging competitor to the Big 4 monitoring companies.  Nimsoft gives CA a double-shot-in-the-arm of much needed excitement, product differentiation, and thought leadership.

What does Nimsoft bring to CA?

  • Approximately 800 Enterprise and Managed Service Provider Customers
  • An innovative Unified Monitoring approach spanning Cloud Computing, SAAS, Data Center, Application, Database, and Virtualization Management
  • Unified Reporting including Customer Dashboards
  • Next generation Event Correlation and Analysis
  • Strong Upward Growth
  • Easy to Use, Powerful, and Elegant Software Solutions
  • Unified Monitoring APIs and 3rd Party Extensions to quickly add existing CA solutions
  • Talent, Leadership, Execution, and more

It is great to hear that Nimsoft will not be folded into CA but instead will be run as a separate business unit.  However, instantly CA feels a bit more hip, in-touch, and ready to step-up to the challenges their customers face.  Suddenly the chuckles of “they bought who” at IBM, HP, and BMC gave way to “holey s***, CA just bought Nimsoft!”

If CA can keep Nimsoft’s talent, rationalize their product portfolio, and integrate some key CA assets into a single integrated solution suite, then they will be a force to reckon with.  Additionally, by no means do I think the M&A activity is over for CA or any of the Big 4.

Congrats to Nimsoft for collecting a cool $350 million and building a strong, innovative, and growing business.  Congrats to CA for recognizing all of the above and adding a gem to their cloud computing management portfolio.

Filed under Cloud Computing, M&A Tagged with , , , , , , , , , , , , , , ,

← Older posts

Follow

Get every new post delivered to your Inbox.

Join 270 other followers

%d bloggers like this: