Years ago, IBM made the smart decision to stop trying to be a pure cloud infrastructure provider. It knew it could never compete with Amazon, Microsoft, and Google. Since then, it has helped IT departments handle complicated hybrid environments by buying a number of well-known companies with its money.
It started when the company bought Red Hat for $34 billion in 2018, then Apptio for the same amount of money last year, and on Wednesday, it announced that it would be buying cloud management company HashiCorp for $6.4 billion.
Big Blue gets a set of cloud lifecycle management and security tools from HashiCorp. It also gets a company that is growing much faster than any of IBM’s other businesses. The income is still small by IBM standards, at $155 million last quarter, up 15% from the previous year. That still means it’s a good business for IBM to add it to its range of mixed cloud tools.
There’s no doubt that IBM CEO Arvind Krishna thinks this piece is important to the hybrid strategy of his company. He even made a mention to AI just for fun. “HashiCorp has a history of helping clients deal with the complexity of today’s infrastructure and application sprawl.” He said in a statement, “Combining IBM’s portfolio and expertise with HashiCorp’s capabilities and talent will create a full hybrid cloud platform built for the AI era.”
Last year, HashiCorp got a lot of attention when it changed the license on its open source Terraform tool to make it better for the business. The people who worked on Terraform weren’t happy with it, so they made OpenTofu, a new open source option. When the new community made the OpenTofu fork, HashiCorp recently said that they were abusing Terraform’s open source code. Since the business is now part of IBM, it will be interesting to see if they keep thinking this way.
It’s important to note that Red Hat also made news last year when it changed the terms of its open source licenses, which made the open source community very upset. These companies might work well together, both in terms of the tools they make and the ways they change their minds about open source.
Since the Infrastructure Cloud came out this week, the company has introduced a new platform idea that should fit well into IBM’s hybrid cloud product catalog. What they did wasn’t very useful, but it brought all of the products together under one roof, which made it easier for sales and marketing to show buyers.
If IBM treats HashiCorp like it does Red Hat, the company will be able to stay separate within the IBM family of goods. He used to be the CIO of AVOA, a research group that says the company should stay neutral.
“I would be worried if IBM quits working with multiple cloud providers like Hashicorp does and instead focuses on IBM Cloud.” “I don’t think that would happen because IBM has recently shown that they are more willing to work with other cloud providers,” Crawford wrote in a new blog post.
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From its start in 2012 to its IPO in 2021, HashiCorp raised almost $350 million.
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