IBM's acquisition of Red Hat for $34 billion is now a done deal, and statements from the leadership of both companies sound extremely promising. But some Linux users have expressed concern.
Questions being asked by some Linux professionals and devotees include:
- Will Red Hat lose customer confidence now that it’s part of IBM and not an independent company?
- Will IBM continue putting funds into open source after paying such a huge price for Red Hat? Will they curtail what Red Hat is able to invest?
- Both companies’ leaders are saying all the right things now, but can they predict how their business partners and customers will react as they move forward? Will their good intentions be derailed?
Part of the worry simply comes from the size of this deal. Thirty-four billion dollars is a lot of money. This is probably the largest cloud computing acquisition to date. What kind of strain will that price tag put on how the new IBM functions going forward? Other worries come from the character of the acquisition – whether Red Hat will be able to continue operating independently and what will change if they cannot. In addition, a few Linux devotees hark back to Oracle’s acquisition of Sun Microsystems in 2010 and Sun’s slow death in its aftermath.
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The good news is that this merger of IBM and Red Hat appears to offer each of the companies some significant benefits. IBM makes a strong move into cloud computing, and Red Hat gains a broader international footing.
The other good news relates to the pace at which this acquisition occurred. Initially announced on October 28, 2018, it is now more than eight months later. It’s clear that the leadership of each company has not rushed headlong into this new relationship. Both parties to the acquisition appear to be moving ahead with trust and optimism. IBM promises to ensure Red Hat's independence and will allow it to continue to be "Red Hat" both in name and business activity.
The end of Red Hat highly unlikely
Will this acquisition be the end of Red Hat? That outcome is not impossible, but it seems extremely unlikely. For one thing, both companies stand to gain significantly from the other’s strong points. IBM is likely to be revitalized in ways that allow it to be more successful, and Red Hat is starting from a very strong position. While it’s a huge gamble by some measurements, I think most of us Linux enthusiasts are cautiously optimistic at worst.
IBM seems intent on allowing Red Hat to work independently and seems to be taking the time required to work out the kinks in their plans.
As for the eventual demise of Sun Microsystems, the circumstances were very different. As this coverage in Network World in 2017 suggests, Sun was in an altogether different position when it was acquired. The future for IBM and Red Hat appears to be considerably brighter – even to a former (decades earlier) member of the Sun User Group Board of Directors.
The answer to the question posed by the title of this post is “probably not.” Only time will tell, but leadership seems committed to doing things the right way – preserving Red Hat's role in the Linux world and making the arrangement pay off for both organizations. And I, for one, expect good things to come from the merger – for IBM, for Red Hat and likely even for Linux enthusiasts like myself.
[ Now read this: The IBM-Red Hat deal: What it means for enterprises ]