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IBM Stops Buybacks to Pay for Red Hat

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Re: IBM Stops Buybacks to Pay for Red Hat

#31

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

Lying like that is a great way to have to deal with lawsuits from every investor who isn’t convinced that the deal is a good idea.

Re: IBM Stops Buybacks to Pay for Red Hat

#32
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.

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.

Re: IBM Stops Buybacks to Pay for Red Hat

#33

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.

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)

Re: IBM Stops Buybacks to Pay for Red Hat

#34
post #4

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

The general strategy seems to be: IBM's customers have been slowly transitioning from proprietary IBM OSs (AIX, z/OS) to Linux for a lot of their workloads, and IBM has accommodated this out of necessity, but wants to retain licensing revenue and some degree of branding/control in that situation by having such customers on an Enterprise IBM Linux. RHEL more or less already owned the Enterprise Linux space, so IBM jus…

Everything you say was true in 2004, when i was there, and they tried to do the same thing with SuSe without buying it.

Re: IBM Stops Buybacks to Pay for Red Hat

#35
post #4

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

The general strategy seems to be: IBM's customers have been slowly transitioning from proprietary IBM OSs (AIX, z/OS) to Linux for a lot of their workloads, and IBM has accommodated this out of necessity, but wants to retain licensing revenue and some degree of branding/control in that situation by having such customers on an Enterprise IBM Linux. RHEL more or less already owned the Enterprise Linux space, so IBM jus…

IBM's customers have been slowly transitioning from proprietary IBM OSs (AIX, z/OS) to Linux for a lot of their workloads

Yes, but that’s only a coincidence. What they have really been doing is transitioning from proprietary to commodity hardware. Which IBM no longer makes. Where does IBM make money? Mainframe sales. There can be only one winner here... IBM will need to kill off their mainframe business to justify this purchase, something they have proved very reluctant to do.

Re: IBM Stops Buybacks to Pay for Red Hat

#36

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.

> single server distro is becoming irrelevant as the unit of computation resources is the kubernetes cluster

In the HN/cloud echo chamber, that might be worth pointing out.

Re: IBM Stops Buybacks to Pay for Red Hat

#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 and late shareholders are all losers.

Re: IBM Stops Buybacks to Pay for Red Hat

#38
post #23
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.

So why run a full os for container runtime? Wouldn’t a hypervisor be more efficient? What is the point of red hat at that point

Doesn’t Red Hat own CoreOS?

Re: IBM Stops Buybacks to Pay for Red Hat

#39
post #31

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

Lying like that is a great way to have to deal with lawsuits from every investor who isn’t convinced that the deal is a good idea.

It’s a little easier for them to just lie to customers.
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