IBM, the 6th biggest contributor to Linux Kernel, acquires RedHat for $34 Billion

The $34 billion all cash deal to purchase opensource pioneer Red Hat is IBM's biggest ever acquisition by far. The deal will give IBM a major foothold in fast-growing cloud computing market and the combined entity could give stiff competition to Amazon's cloud computing platform, AWS. But what about Red Hat and its future?


Another Oracle - Sun Micorsystems deal in the making? 
The alarmists among us might be quick to compare the IBM - Red Hat deal with the decade old deal between Oracle Corporation and Sun Microsystems, which was then a major player in opensource software scene.

But fear not. Unlike Oracle (which killed off Sun's OpenSolaris OS almost immediately after acquisition and even started a patent war against Android using Sun's Java patents), IBM is already a major contributor to opensource software including the mighty Linux Kernel. In fact, IBM was the 6th biggest contributor to Linux kernel in 2017.

What's in it for IBM?
With the acquisition of Red Hat, IBM becomes the world's #1 hybrid cloud provider, "offering companies the only open cloud solution that will unlock the full value of the cloud for their businesses", according to Ginni Rometty, IBM Chairman, President and CEO. She adds:

“Most companies today are only 20 percent along their cloud journey, renting compute power to cut costs. The next 80 percent is about unlocking real business value and driving growth. This is the next chapter of the cloud. It requires shifting business applications to hybrid cloud, extracting more data and optimizing every part of the business, from supply chains to sales.”

The Future of Red Hat
The Red Hat story is almost as old as Linux itself. Founded in 1993, RedHat's growth was phenomenal. Over the next two decades Red Hat went on to establish itself as the premier Linux company, and Red Hat OS was the enterprise Linux operating system of choice. It set the benchmark for others like Ubuntu, openSUSE and CentOS to follow. Red Hat is currently the second largest corporate contributor to the Linux kernel after Intel (Intel really stepped-up its Linux Kernel contributions post-2013).

Regular users might be more familiar with Fedora Project, a more user-friendly operating system maintained by Red Hat that competes with mainstream, non-enterprise operating systems like Ubuntu, elementary OS, Linux Mint or even Windows 10 for that matter. Will Red Hat be able to stay independent post acquisition?

According to the official press release, "IBM will remain committed to Red Hat’s open governance, open source contributions, participation in the open source community and development model, and fostering its widespread developer ecosystem. In addition, IBM and Red Hat will remain committed to the continued freedom of open source, via such efforts as Patent Promise, GPL Cooperation Commitment, the Open Invention Network and the LOT Network." Well, that's a huge relief.

In fact, IBM and Red Hat has been partnering each other for over 20 years, with IBM serving as an early supporter of Linux, collaborating with Red Hat to help develop and grow enterprise-grade Linux. And as IBM CEO mentioned, the acquisition is more of an evolution of the long-standing partnership between the two companies.
"Open source is the default choice for modern IT solutions, and I’m incredibly proud of the role Red Hat has played in making that a reality in the enterprise,” said Jim Whitehurst, President and CEO, Red Hat. “Joining forces with IBM will provide us with a greater level of scale, resources and capabilities to accelerate the impact of open source as the basis for digital transformation and bring Red Hat to an even wider audience – all while preserving our unique culture and unwavering commitment to open source innovation."
Predicting the future can be tricky. A lot of things can go wrong. But one thing is sure, the acquisition of Red Hat by IBM is nothing like the Oracle - Sun deal. Between them, IBM and Red Hat must have contributed more to the open source community than any other organization.