IBM closes $34B Red Hat deal, vaults into multi-cloud

By | August 23, 2019

IBM has finalized its $34 billion purchase of Red Hat and states it will use the Linux powerhouse’s open know-how to enable larger scale customer jobs and also to create a web of partnerships to simplify carrying out them.

“A great deal of our mutual customers are interested in doing a lot more,” says Arvind Krishna, Senior Vice President, IBM Cloud & Cognitive Software in a blog post. “Many see this as an opportunity for individuals to create large industry ecosystems with other providers that are optimized on this common infrastructure. . . .If Red Hat were to do so in their own, there would be a limit to just how much they could scale. Together, we could put far more resources into refining other partners.”

The combined companies will also be able to smooth out the challenges of multi-cloud surroundings where each cloud provider’s implementation differs from others, states Paul Cormier, Red Hat Executive Vice President and President, Products and Technologies, at the exact same blog post.

“[All] the clouds, despite the fact that they have the exact same underlying technology, they’re all different,” says Cormier. “And so, as customers want to length clouds, they’re realizing now that they have to have four or five distinct islands of technology stacks that developers have to develop for, which operations people have to operate. That’s really unsustainable from a management perspective.”

By combing the two businesses, their development teams will also have the ability to work on making their products easier to delploy, Krishna says. “Capabilities like retrieval, monitoring, safety, and auditing are seldom built in. And they frequently cannot be set up in one click. Usually, each one these configurations have to be carried out manually,” he says. “So, a huge problem our customers need us to resolve is to make the entire process much easier.”

More broadly, IBM hopes to create a single Linux operating environment which will span any kind of business IT infrastructure from bare metal to virtual machines into oceans, Cormier says. “This is the issue which we are planning to solve–providing a single, common operating environment across the hybrid vehicle and multicloud world. As we help lay down this one common operating environment, we will not only help operators but also help developers have one operations policy, one deployment coverage and one security coverage,” he says. “They will have a single environment where they can build once and deploy in any one of the footprints that’s appropriate.”

IBM will last Red Hat’s historical commitment to open source, ” says Chris Wright, CTO of Red Hat. “As we begin this new chapter with IBM, Red Hat will continue to become and do what it always has,” Wright says in a separate site . “We shall continue to direct and participate in communities. We will continue with our work in many open source projects. Along with the technology we develop and provide to our clients will continue to be available.”

As it announced plans to purchase Red Hat this past year, IBM said it expects expansion in the use of cloud solutions to blossom, with enterprises poised to refrain from utilizing cloud to get inexpensive compute power to putting more applications in the cloud.

“To do so, companies need an open, hybrid approach to creating, running and deploying applications in a multi-cloud surroundings,” IBM said in a written announcement.

IBM and Red Hat have partnered for at least a year to integrate their cloud offerings: Red Hat’s Open Stack personal cloud system and its Ceph Storage and IBM’s public cloud. The aim was to lure Red Hat clients by enabling use of Red Hat’s management for workloads put in the IBM cloud.

In addition to hybrid support, the pending merger will provide corporate programmers with container and Kubernetes technology essential for their work composing cloud-native applications, he says.

IBM is calling its buy of Red Had its biggest investment which will allow it to expand its portfolio to increase and the magnitude of its $19 billion cloud company and tap into what it sees as a $1 trillion economy.

Red Hat has become a free-standing unit of IBM that will keep its leadership, culture and facilities, IBM states.