IBM Stops Buybacks to Pay for Red Hat • Hacker News Board

Re: IBM Stops Buybacks to Pay for Red Hat

#41

Post by mike_hearn » Sat, Aug 10, 2019, 4:32 PM UTC

streetcat1 wrote: post #11

mrtksn wrote: post #4

Can someone explain why Red Hat is so valuable? Why would IBM put such a big bet?

Becuase of kubernetes. The platform of platforms. Kubernetes is the andriod to amazon iphone (in analogy). It is the only way to get out of cloud vendor lock in. IBM is mainly a consultancy business, so they basically back integrated with the cloud os - kubernetes, or more specifically in this case - open shift. The only issue here is that are around 23 or more certified kubernetes distors, so this might have been an…

Kubernetes has nothing to do with cloud vendor lockin. I don't know where you're getting this from. Any hosting provider can spin you up some managed Linux nodes on a bunch of distros and they can be admined by the same tools and same people. That's why all the big clouds spend so much effort creating new services with custom APIs that aren't just "run a process in a chroot jail with fiddly bits". Big Data, AI and so on. That container will still need to store data somewhere, get traffic from somewhere else, etc, and they want to sell you services to do that.

If anything I am skeptical about Kubernetes' future. Not in the short term, k8s/docker are the MongoDB of the late 2010s and the same sorts of people are jumping on the bandwagon. But look at the discussion about the AMD EPYCs in Google Cloud. Big machines are now getting so big that a bog standard OS running a bunch of processes is going to provide more than enough power for even very large websites.

One machine now provides more power than a whole rack used to, and horizontal scaling technologies are expensive. A research paper from 2013 showed that just scaling up beat the performance of scaling up for virtually all jobs analysed, which came from Microsoft, Yahoo, and Facebook. So the sorts of companies that are poster-children for this kind of cloud technology.

https://www.researchgate.net/publication/261862149_Scale-up_...

There's not much career or intellectual capital to be gained by just running things on big boxes, but, eventually the cost effectiveness of this will become hard to ignore.

Re: IBM Stops Buybacks to Pay for Red Hat

#42

Post by petemc_ » Sat, Aug 10, 2019, 4:32 PM UTC

koolba wrote: post #28

orev wrote: post #18

Earlier quoted context omitted.

You do realize that those containers eventually need to be hosted somewhere , right? That somewhere is a server running an operating system. Containers are more a threat to virtual machine OSes than ones that host containers.

But the hosts no longer need the full distro stack traditionally provided by a RHEL. Just a thin enough veneer for a container runtime with live kernel updates. Maybe there’s a market for intra container licenses but it’s a harder sell as even there the goal is to go slim.

Precisely why Red Hat are moving to CoreOS for openshift.

Re: IBM Stops Buybacks to Pay for Red Hat

#43

Post by riffraff » Sat, Aug 10, 2019, 4:35 PM UTC

mathattack wrote: post #37

A dying company trying to extend their “squeeze your base” policy to another vendor. I think they overpaid for RedHat. After a particularly painful audit at my Fortune 500, we kicked out RedHat. We spend more time talking to IBMs auditors than we do to their Salespeople and engineers. This merger seems like the modern version of HP and Compaq. The only winners are the shareholders who bolt early. Customers, employees…

Forgive my ignorance,but what is an IBM auditor?

Re: IBM Stops Buybacks to Pay for Red Hat

#44

Post by chipperyman573 » Sat, Aug 10, 2019, 4:36 PM UTC

broknbottle wrote: post #17

IBM missed a great marketing opportunity. They should have told the public that the decision to acquire Red Hat was made by Watson

I'm not sure if you're joking, but if you aren't that would be a pretty big risk. If it doesn't pay off they would look pretty bad for Watson

Re: IBM Stops Buybacks to Pay for Red Hat

#45

Post by Aloha » Sat, Aug 10, 2019, 4:41 PM UTC

streetcat1 wrote: post #14

tonyedgecombe wrote: post #13

The big risk is that IBM drags Redhat down to their level. This wouldn't be unusual, most takeovers fail to deliver shareholder value.

There is nothing to drag. A single server distro is becoming irrelevant as the unit of computation resources is the kubernetes cluster. I.e. all the app see is a set of kubernetes nodes, it does not really care what server disto you are running on.

I think you're living in a different world than I am

Re: IBM Stops Buybacks to Pay for Red Hat

#46

Post by sharpneli » Sat, Aug 10, 2019, 4:41 PM UTC

riffraff wrote: post #43

mathattack wrote: post #37

A dying company trying to extend their “squeeze your base” policy to another vendor. I think they overpaid for RedHat. After a particularly painful audit at my Fortune 500, we kicked out RedHat. We spend more time talking to IBMs auditors than we do to their Salespeople and engineers. This merger seems like the modern version of HP and Compaq. The only winners are the shareholders who bolt early. Customers, employees…

Forgive my ignorance,but what is an IBM auditor?

https://ibmaudits.com/ibm_faq/

Read and despair.

tl;dr: They dig around to see you’re paying the correct license fees.

They’re common and expensive enough that law firms offer special counseling explicitly for that.

Re: IBM Stops Buybacks to Pay for Red Hat

#47

Post by Aloha » Sat, Aug 10, 2019, 4:42 PM UTC

mathattack wrote: post #37

A dying company trying to extend their “squeeze your base” policy to another vendor. I think they overpaid for RedHat. After a particularly painful audit at my Fortune 500, we kicked out RedHat. We spend more time talking to IBMs auditors than we do to their Salespeople and engineers. This merger seems like the modern version of HP and Compaq. The only winners are the shareholders who bolt early. Customers, employees…

I disagree that IBM is dying, not aggressively growing, but not dying.

Re: IBM Stops Buybacks to Pay for Red Hat

#48

Post by streetcat1 » Sat, Aug 10, 2019, 4:45 PM UTC

beagle3 wrote: post #32

streetcat1 wrote: post #22

Earlier quoted context omitted.

Right. All I need from a node is the CPU / Memory and a docker daemon. The less I know about an OS or any other services / patches, etc the better. I.e. I want my nodes to be cattles.

The same mindset would dictate that you only ever buy no-name hardware which is about 30% cheaper than dell/hp for the same performance characteristics... why would anyone do that? And that's why people DO pay for red-hat. Peace of mind, whether supported by evidence or not.

So people pay for redhat because they did not move to container/ microservices architecture. Any main stream technology (Mainframe, Dec/Vax, PC, VM) will always have legacy customers.

However, one the state of the art architecture is micro services, the optimal runtime is kuberentes. Once everyone is on kubernetes hardware will not matter.

Moreover, I would love a cloud based on second hand hardware (which should be much cheaper than 30%).

Re: IBM Stops Buybacks to Pay for Red Hat

#49

Post by kgwgk » Sat, Aug 10, 2019, 4:47 PM UTC

riffraff wrote: post #43

mathattack wrote: post #37

A dying company trying to extend their “squeeze your base” policy to another vendor. I think they overpaid for RedHat. After a particularly painful audit at my Fortune 500, we kicked out RedHat. We spend more time talking to IBMs auditors than we do to their Salespeople and engineers. This merger seems like the modern version of HP and Compaq. The only winners are the shareholders who bolt early. Customers, employees…

Forgive my ignorance,but what is an IBM auditor?

The person who comes to check that you’re using their products according to the licensing agreements and what you’re paying for, I imagine.

Re: IBM Stops Buybacks to Pay for Red Hat

#50

Post by streetcat1 » Sat, Aug 10, 2019, 4:48 PM UTC

ryukafalz wrote: post #33

streetcat1 wrote: post #14

Earlier quoted context omitted.

There is nothing to drag. A single server distro is becoming irrelevant as the unit of computation resources is the kubernetes cluster. I.e. all the app see is a set of kubernetes nodes, it does not really care what server disto you are running on.

Red Hat does a lot more than just RHEL. They've got a Kubernetes distribution (OpenShift) and a ton of useful software under their umbrella. (Ceph, GlusterFS, FreeIPA, Ansible... etc)

So all of those are quite exotic, and thus risky / expensive to support.