VMware: $420 Million SpringSource Deal Pressures Red Hat
Red Hat's fastest-growing channel business -- the JBoss middleware platform -- potentially faces new competition. The aggressor is VMware, which has acquired SpringSource for $420 million. Here's the scoop.
Red Hat’s fastest-growing channel business — the JBoss middleware platform — potentially faces new competition. The aggressor is VMware, which has acquired SpringSource for $420 million. Here’s the scoop.
SpringSource‘s software allegedly simplifies Java application development. And it increasingly competes with Red Hat’s JBoss platform.
No doubt, The VAR Guy has been singing Red Hat’s praises in recent months. Integrators working with JBoss typically make $10 or more in consulting fees for every dollar of JBoss they actually sell, according to Red Hat’s own data. Plus, Red Hat is working with Synnex to build the Open Source Channel Alliance — which involves roughly a dozen open source companies promoting applications to roughly 15,000 Synnex resellers.
At first glance, Red Hat’s Linux and JBoss offerings are a killer combo. But suddenly, VMware is countering with a $420 million buyout of SpringSource. As CNet’s Matt Asay points out:
SpringSource’s ubiquitous Spring Framework already threatened Red Hat’s booming JBoss business. But add VMware’s leading virtualization technology and suddenly Red Hat is under siege by a highly credible and disruptive competitor that could well outflank it.
Well said, Mr. Asay. The VAR Guy agrees.
Our resident blogger will be watching closely as Red Hat and VMware host competing conferences in a few weeks:
No need for Red Hat to press the panic button. The company’s ability to attract ISVs (independent software vendors) and channel partners toward Red Hat Enterprise Linux and JBoss remains strong. Plus, Red Hat is expected to revamp its partner strategy in the next few days, The VAR Guy hears.
Still, VMware was a real and present danger to Red Hat even before the SpringSource deal. Now, the showdown between Red Hat and VMware truly gets interesting.