IBM to buy Red Hat for $34 Billion

[Jimzz]

IBM Will Acquire Open-Source Software Company Red Hat In $34 Billion Deal
https://www.npr.org/2018/10/28/6615...-acquire-open-source-software-company-red-hat

Does RH have any IP/Patents? I thought they were a all open source company. I know IBM wants to move more toward the service side of things but 34 billion is 34 billion.

My bet it the best talent will be gone from RH in the next year or two and this will be written off again like many other IBM ventures.

 

[ultimatebob]

What sucks is that there are millions of servers out there that run either Red Hat or CentOS Linux. If IBM screws it up, it's going to be a pain in the ass to migrate them to another platform.

 

[pauldun170]

Eeeeew....
I feel sorry for the folks over at redhat.

They should welcome all the new Redhat folks by giving them old OS/2 t-shirts.

 

[ultimatebob]

Heh... maybe they'll rename RHEL to OS/3

Although something more like IBM Enterprise Linux is more likely. They'll probably tweak the license for CentOS pretty quickly to say that production workloads are "unsupported" on it, since IBM doesn't like giving away "Enterprise" grade software away for free.

 

[Red Squirrel]

Heard this yesterday, sucks. Wonder what this will mean for the future of CentOS. Might be time to start evaluating different distros.

 

[SKORPI0]

So what does IBM gain by buying RH? Why $34 billion?
https://en.wikipedia.org/wiki/Red_Hat

Red Hat, Inc. is an American multinational software company providing open-source software products to the enterprise community. Founded in 1993, Red Hat has its corporate headquarters in Raleigh, North Carolina, with other offices worldwide.[4]

Red Hat has become associated to a large extent with its enterprise operating system Red Hat Enterprise Linux and with the acquisition of open-source enterprise middleware vendor JBoss. Red Hat also offers Red Hat Virtualization (RHV), an enterprise virtualization product. Red Hat provides storage, operating system platforms, middleware, applications, management products, and support, training, and consulting services.

Red Hat creates, maintains, and contributes to many free software projects. It has acquired several proprietary software product codebases through corporate mergers and acquisitions and has released such software under open source licenses. As of March 2016, Red Hat is the second largest corporate contributor to the Linux kernel version 4.14 after Intel.[5]

List of mergers and acquisitions by IBM

 

[BarkingGhostar]

If you can't innovate then assimilate. All your RedHatz belong to IBM.

 

[quikah]

So what does IBM gain by buying RH? Why $34 billion?

They are trying to catch up to Amazon and MS in cloud. The price seems kind of ridiculous though.

 

[ImpulsE69]

So basically, the corporate world better get ready, MS isn't go forward, and now who knows if RH will be in the next 5 years...

 

[Sonikku]

I think I hate IBM.

 

[rh71]

My username stands for Red Hat 7.1.

Not really. And I finally left IBM, because I heard they were doing this.

Maybe.

 

[UglyCasanova]

How is Redhat worth $34 billion? Or how is it worth $1? I don’t understand how they monetize open source,.

 

[Red Squirrel]

Maybe with Red Hat they'll be able to fix the phoenix pay system lol.

 

[Red Squirrel]

How is Redhat worth $34 billion? Or how is it worth $1? I don’t understand how they monetize open source,.

Support contracts I think. Basically they wrote a lot of software like RH OS and other stuff in it, it's open source, but companies still like buying really expensive software from a big commercial company, RH is such a company.

 

[who?]

Is open source the same as free?

 

[Hugo Drax]

Most of it will end up as Goodwill on the balance sheet and eventually it will be written off. This is another acquisition so the CEO can live for another day and now collect a bonus for increasing revenue etc.. It will take IBM 140 years to get its money back.

They should have just paid out a special dividend if they had no idea what to do with their cash on the balance sheet. This will not be a net positive for IBM shareholders.

 

[Kaido]

Support contracts I think. Basically they wrote a lot of software like RH OS and other stuff in it, it's open source, but companies still like buying really expensive software from a big commercial company, RH is such a company.

There's a ton of money in services & support.

I was a huge open-source geek in college & wanted to setup companies with pfSense, FreeNAS, various *nix servers with varying roles, but what I found out was that you just don't have time to do everything in the real world. I can't support hundreds of users if I'm spending all of my time monkeying around with an open-source IDS when there's two dozen other hot projects that need to get done & users who need support.

Bottom line is, for many (profitable) companies, uptime = value = they'll pay what it takes to maintain uptime. I primarily do work for production businesses in the manufacturing & food service sectors. When the computer systems go down, they are losing money every hour that things don't work. I just don't have time to screw around with stuff & become an expert at it on the job, which is why it's easier to buy something like a Barracuda or a QNAP or a whatever that operates turn-key, receives regular verified updates, and has a tech support line if things go down.

It's about deciding what you want to juggle in your allotted work time. I'd love to deep-dive into dozens of open-source projects, and there are a select few that I do do that with, but when things go haywire, I need to get things operational pronto because now I'm the one holding up people from working. So especially in something as technical as Linux, having a Red Hat service contract could easily be worth the money when you get stuck & need help to get things operational.

 

[heymrdj]

There's a ton of money in services & support.

I was a huge open-source geek in college & wanted to setup companies with pfSense, FreeNAS, various *nix servers with varying roles, but what I found out was that you just don't have time to do everything in the real world. I can't support hundreds of users if I'm pending all of my time monkeying around with an open-source IDS when there's two dozen other hot projects that need to get done & users who need support.

Bottom line is, for many (profitable) companies, uptime = value = they'll pay what it takes to maintain uptime. I primarily do work for production businesses in the manufacturing & food service sectors. When the computer systems go down, they are losing money every hour that things don't work. I just don't have time to screw around with stuff & become an expert at it on the job, which is why it's easier to buy something like a Barracuda or a QNAP or a whatever that operates turn-key, receives regular verified updates, and has a tech support line if things go down.

It's about deciding what you want to juggle in your allotted work time. I'd love to deep-dive into dozens of open-source projects, and there are a select few that I do do that with, but when things go haywire, I need to get things operational pronto because now I'm the one holding up people from working. So especially in something as technical as Linux, having a Red Hat service contract could easily be worth the money when you get stuck & need help to get things operational.

 

[Exterous]

Between Microsoft's huge push to be OS agnostic (linux adoption, PS Core) and IBM buying Redhat I feel like I'm in some sort of weird alternate reality

 

[ultimatebob]

It could be worse I guess... Google could have bought them, and then tried to force everyone over to whatever distribution they use.

I'm curious how Amazon Linux and Oracle Linux are going to change as well, as they are also based off of RedHat. I'm wondering if we're going to see a "NotBlue Hat Linux" fork soon

 

[ch33zw1z]

Between Microsoft's huge push to be OS agnostic (linux adoption, PS Core) and IBM buying Redhat I feel like I'm in some sort of weird alternate reality

IBM is heavy into *nix already, I'm not that surprised they picked up redhat. The price tag is a bit staggering, but meh.

 

[mrblotto]

This whole thing has got me interested in trying to install OS/2 (or whatever it is now) on more modern computers:

https://www.theregister.co.uk/2017/05/19/new_version_of_os_2_arca_os_5/

yeesh - $99 for a license? I dunno....I still have a copy of OS/2 v3 in shrinkwrap lol