Let me start with a few disclaimers.  By virtue of working in the IBM WebSphere Application Server team, I compete with SpringSource. I know, and like, several of the key people at SpringSource.  I’m happy that their hard work paid of with such a large exit. While I compete with SpringSource, I’m excited that this acquisition will raise the bar for vendors that I care about, and ultimately, customers will benefit the most.

There has been a lot of analysis about VMware’s acquisition of SpringSource.  By in large, the analysis has taken the vision of Clouds and PaaS laid out in VMware’s press release as a likely outcome.  Let me try a different approach by discussing what VMware really bought.

VMware bought SpringSource because “Spring is everywhere”:
Yes, but sadly for VMware, no.  The Spring Framework is widely used in the enterprise Java market.  From my own experience, many WebSphere customers use the Spring Framework on top of WebSphere.  But many WebSphere customers use the competing EJB open standard in place of the proprietary, but open source, Spring Framework.  The most recent Eclipse user survey results found that of the 436 respondents building server side applications, 47.5% were using the Spring Framework and 38.3% were using EJBs.  This data clearly demonstrates that customers exhibit a need for choice significantly higher than proclamations of Spring’s enterprise Java domination would suggest.

With such a high usage penetration, one could expect a significant revenue base for SpringSource.  Yet, SpringSource is estimated to have driven $20 million in revenue, or maybe bookings, mainly from professional services.  This is a very respectable base for a company with 150 employees.  IDC however estimated the 2008 Application Server market at nearly $3.8 billion.  So, while the Spring Framework is widely used, SpringSource has not been able to extract significant market share as a result.

VMware may believe that adding their brand and sales reach to the SpringSource portfolio will drive higher revenue from the Spring Framework and related Spring products.  Redmonk’s Stephen O’Grady subscribes to this view, using the MySQL acquisition by Sun as a proof point.  I disagree because a framework is different than a database and the other Spring products have nowhere close to the penetration of the Spring Framework, as I discuss below.  Additionally, if a customer has been using the Spring Framework for the past 5 years without a support contract or subscription, why acquire support or a subscription now?  The only reason for doing so will be if VMware and SpringSource disadvantage the open source Spring Framework in favor of the enterprise, commercially licensed, Spring Enterprise. The community uproar the last time SpringSource tried this approach leads me to believe that VMware and SpringSource won’t go down this path again.

VMware bought SpringSource because SpringSource now has a “Build-Run-Manage” story:
Yes, but sadly for VMware, no.  Trying to build a significant business selling support subscriptions to the large number of Spring Framework users proved to be a tough nut to crack.  The key insight for SpringSource was that customers paid for runtimes and integrated administration and management of runtimes, not for frameworks.  SpringSource responded by acquiring Covalent and Hyperic in order to deliver two runtimes, SpringSource tc Server and SpringSource dm Server with administration and management capabilities via Hyperic.  SpringSource has introduced a “build-run-manage” marketing campaign which always makes me chuckle as I recall IBM using Build-Run-Manage back in the early 2000s.  I understand that SpringSource is attempting to educate the market that they are no longer only a framework provider, but rather, now have not one, but two, runtimes that customers can purchase.

It’s arguable that one or both of these products will become the basis for VMware’s beachhead into the middleware market.  So what are the prospects for tc Server and dm Server?

Since tc Server is aimed at Tomcat usage, it’s important to ask what customers running large Tomcat environments used before tc Server came to market?  Well, some used Tomcat without support.  Others used JBoss, Geronimo, GlassFish and WAS Community Edition which deliver Tomcat inside.  Finally, others purchased Tomcat support from Covalent, OpenLogic etc.  For the most part, customers who have not purchased Tomcat support or management for 5+ years are not going to buy a product now.  If the customer was missing some of the management capabilities that tc Server provides, by now, the customer has built this capability in house. I know of several large Tomcat users that fall into this situation.  The customer now has to consider the sunk costs of their custom code versus the cost of acquiring a new product.  Next, customers that have purchased Tomcat support are targets for tc Server.  But these customers are also being targeted by JBoss, Geronimo, GlassFish and WAS Community Edition.  Finally, tc Server can compete against JBoss, Geronimo, GlassFish and WAS Community Edition.  It’s not yet clear that tc Server provides differentiated value that will allow it to win disproportionately against the other products.  The important insight is that very few Tomcat users are using just Tomcat.  They use other parts of a Java Enterprise Edition (JEE) stack, such as JMS messaging or Web Services.  So given the choice of tc Server with just Tomcat runtime features or a JEE product which includes Tomcat and other JEE APIs is not as cut and dry as SpringSource’s marketing would suggest.

In the nearly 10 months since dm Server became generally available, I’ve frankly heard of virtually no customer usage.  But don’t take my word for it.  As your neighborhood Java developer if they’ve heard of dm Server, or if they’ve used dm Server.  The key issue with dm Server is that it’s proprietary.  Developers and their managers were comfortable using the Spring Framework because, while the framework was proprietary, they could easily move their applications across multiple standards-based JEE application servers.  Protection from vendor lock-in was delivered by the runtime application server.  Customers continue to expect this.  If you build a dm Server application, there is exactly one runtime it will run on.   Hence, dm Server fails the vendor lock-in test, and its adoption is a testament to this failure.  This is however a fixable problem for VMware.  dm Server could be evolved to meet the forthcoming JEE 6 Web Profile specification, which Geronimo, GlassFish, JBoss, WebLogic and WebSphere are all expected to support.

VMware is going to find that broad usage of a framework or having a Build-Run-Manage story does not easily translate into customers migrating off their existing Java standards compliant application server runtime to a proprietary runtime.

VMware bought SpringSource because of the Cloud & PaaS angle:
Yes, but we’ll see.  Cloud and PaaS are the two reasons that VMware and SpringSource have claimed as motivations for the acquisition.  I couldn’t say it better than Redmonk’s Stephen O’Grady:

“In time, yes, quite possibly. And there’s little question that SpringSource offers VMware an intriguing opportunity to be what 10gen, Project Caroline, et al have to date failed to be: the EngineYard or Heroku for Java, permitting seamless deployment of Java applications to on or off premise cloud infrastructure. But this is, to me, a longer term revenue opportunity, as VMware’s cloud pieces are still coming together and its hardware and datacenter capabilities are neglible relative to competition such as Amazon, IBM or Microsoft.”

Additionally, whether VMware and/or SpringSource will acknowledge it, customers are already deploying Java applications to a dynamically provisioned and policy-based managed cloud.  This isn’t a two or three years from now capability.  As we speak customers are using IBM WebSphere CloudBurst Appliance with WebSphere Application Server and WebSphere Virtual Enterprise to achieve what VMware CEO claimed is: “something our partners aren’t doing yet” when asked by a financial analyst if this deal would alienate partners.  The point is not to discuss IBM products, but rather to highlight that the VMware and SpringSource future vision is already a reality.  And it’s a reality that is driving significant IBM WebSphere revenue around an on premise cloud environment. Again, this is a today statement.

Lastly, since an application runtime environment is critical to a PaaS or Cloud deployment, I’d go back to the fact that SpringSource’s runtime environments, tc Server and dm Server, are starting from a standstill in an uphill battle for revenue share.  While VMware works to establish tc Server and dm Server penetration, VMware will have to be careful not to alienate their application server partners; the ones whose products are driving virtually all of the application server spending today.  This level of coopetition is doable, but not easy.  But hey, VMware has 420 million reasons for doing difficult, but necessary, things.

VMware bought SpringSource because of Microsoft:
Yes. Larry Dignan’s excellent analysis of the acquisition highlighted some very interesting data from a financial analyst, Pritchard:

“In our view the acquisition highlights the vulnerability VMware has in its exposure to Microsoft. We estimate north of 80% (may be as high as 90%, with the rest being Linux) of VMware virtual machines are running Windows server and an application developed in Microsoft’s .NET environment. This is a key strategic vulnerability as Microsoft has a history of absorbing functionality such as VMW that is essentially a layer in the Microsoft stack. Ultimately SpringSource technology may enable VMW to add enterprise Java workloads to diversify away from Windows.”

Microsoft is clearly going after VMware with HyperV inside of Windows Server 2008 R2:

“We’ve got a great solution. It’s a sixth the cost on average of what we see in the marketplace. Evangelizing the tax that VMware is getting from the product is something we look forward to competing with in this environment. Again, it’s about getting specific. It is about getting aggressive, and that’s where we’re headed.”

In an effort to guard against Microsoft marginalizing VMware’s core virtualization business, the SpringSource acquisition puts VMware at odds with Java runtime vendors who collectively represent the approximately 50% of the enterprise market not associated with .NET.   I don’t see how SpringSource helps VMware versus Microsoft in the estimated 80 percent of VMware environments where the application has been developed on .NET as Pritchard suggests.  If the application is .NET based, and the hypervisor is running on top of a Windows host, then this is Microsoft’s customer to lose to or win back from VMware.  VMware is clearly looking past its current deployments where Windows and .NET dominate, to a new Java-based Cloud and PaaS environment. But we already covered that aspect and the competitive hurdles in the Cloud/PaaS portion of this post.

It’s not just Microsoft that is marginalizing the value of a hypervisor.  As mentioned above, IBM WebSphere CloudBurst Appliance and WebSphere Virtual Enterprise treat the hypervisor as an infrastructure component of equivalent value to the host operating systems.  Said differently, the hypervisor, like the operating system has little impact on the application performance, reliability, availability or TCO.  Those application characteristics are enabled through the runtime application server and the dynamic provisioning and management framework around the application server.  This is how IBM’s Cloud solution is designed.  I’ll wager that Oracle and Red Hat’s offering will push value up the stack, beyond the hypervisor layer itself.

VMware bought SpringSource because of the great people at SpringSource:
Yes.  There is solid talent at SpringSource.  VMware has set aside $60 million in retention funding for the approximately 150 SpringSource employees over the next four years.  This $60 million was discussed on the VMware investor call and is in addition to the acquisition price.  This will clearly help VMware retain SpringSource talent.  SpringSource employees will also want to stick around to bring their vision of world domination to fruition ;-)

There is much opportunity and risk for VMware with this acquisition.  If VMware can execute well, they’ll have saved the company from peril at the hands of Microsoft and Hyper-V and application server vendors who are minimizing the value of a hypervisor to the level of the underlying operating system itself.

This acquisition raises the competitive bar for vendors with application server and/or hypervisor offerings.  That’s something customers should be happy about. Fun times ahead!

Follow me on twitter at: SavioRodrigues

PS: I should state: “The postings on this site are my own and don’t necessarily represent IBM’s positions, strategies or opinions.”

In my previous post I mentioned that the WAS V7 Feature Pack for CEA Beta can help you create some pretty awesome user experiences for multi-modal online interactions.  Well, what does that really mean?  Let’s start with a common scenario.

While searching for a life insurance policy online a user might want to call a customer service representative (CSR) about discounts since her mortgage is held by the bank.  More often than naught, the CSR wants to point the user to more information on the bank’s website.  But here’s the dilemma.  The user and CSR are involved in a multi-modal interaction, but there’s no synchronization between the two modes of communication.  If the CSR wants to direct the user to a specific page on the site, he must tell the user “okay, go to the homepage, on the left navigation bar, click Other Offers and then scroll half way down the page, look for a link that says….” Agreed, that’s an ugly interaction.

When the user decides to purchase life insurance, the interaction is no prettier.  While the user and CSR are speaking on the phone and both have browser windows open, there is no linkage between the two modes of communication.  The user still has to speak certain information which the CSR must transcribe into the application form.  There’s no visual way for the user to verify that the CSR has transcribed the spoken information properly.  Try saying “Savio Rodrigues” and the person on the other end of the phone not transcribe “Fabio Rodriguez” or “Flavio Rodriguez” or “Sabio Rodriguez”.  Not cool.

We designed the WAS V7 Feature Pack for CEA Beta to address a scenario in which a user and CSR are involved in a multi-modal interaction prior to the user making a decision.

Click to Call
Let’s consider the same scenario with a Click to Call Web Widget that you can embed in existing and new web applications.

Unlike third party hosted Click to Call offerings, the Click to Call feature in the WAS V7 Feature Pack for CEA Beta can be completely integrated into your application.  No need to spawn another browser window or advertise your hosted provider’s service.  Integrated and consistent user experience? Check.

Next, our Web Widget is integrated with your telephony infrastructure (so far, Cisco & Nortel).  Why pay a third party Click to Call hosted provider per minute fees for calls when you can leverage your existing telephony infrastructure?  Lower costs and driving higher utilization of existing resources? Check.

Finally, any information that you want to share between the user and the CSR through the Click to Call session, such as login information or account numbers, does not have to go through a third party.  Increased privacy & security? Check.

Contact Center Cobrowsing
Okay, you added a Click to Call widget to your application, now what?  Well, your customer enters her phone number and clicks on “Connect”.  The result is a shared session between the user and the CSR (through WebSphere Application Server).  Oh, and there is no software for the user or CSR to install. Security and ease of use? Check.

With this shared session both the CSR and the user can take control and direct what is shown on the other person’s browser window.  Both can highlight elements on the page for the other person to see.  No more having to say “scroll half way down the page and look for the link to the right of the picture of a monkey”.  Improved user experience? Check.

Two Way Forms
Next up, the dreaded filling out of forms over the phone.  But have no fear. Since you have a shared session between the user and CSR, there’s no reason that the form can’t be displayed to both parties.  But why stop there?  The Two Way Forms feature of the WAS V7 Feature Pack for CEA Beta lets both parties enter data into various elements of the form.  You can even restrict the data shown in a form field between the CSR and user.  For example, the user could type in and see their full credit card or social security number, while the CSR would only see the last 3 digits.  The user can even click to confirm that individual form field data was transcribed correctly by the CSR. Fewer frustrated users? Check.

Want to learn more?
Get the WAS V7 Feature Pack for CEA Beta here and the Getting Started guide, part of the Library materials, here.  Also, here’s a good description of the widgets from Erik.  Finally, if you need a copy of WAS V7, you can get a trial here.

Let us know what you think!

Follow me on twitter at: SavioRodrigues

As Erik posted on Friday, the IBM WebSphere Application Server V7.0 Feature Pack for Communications Enabled Applications Beta (WAS V7 Feature Pack for CEA Beta) is now live.

Why should developers care?

Skills Reuse, Improved User Experiences, Lower Costs:
Well, with your existing Java skills, the WAS V7 Feature Pack for CEA can help you create some pretty awesome user experiences that improve the effectiveness of multi-modal online interactions and reduce costs. The WAS V7 CEA Feature Pack targets scenarios where users are interacting with each other through multiple modes of communications.

We’ve all been on a website, or for that matter, any web-based application, trying to find the right information before making a (purchase) decision. Often, multiple modes of communications (i.e. phone & website; instant messaging & website, etc.) are needed to obtain the information and make the decision.

Over the next two posts (here & here) I’ll discuss two key scenarios where the WAS V7 feature pack for CEA Beta shines. Saddle up…

Follow me on twitter at: SavioRodrigues

Evans Data Corporation just released a report titled “Application Servers 2008 Ranking”. You can get your hands on the free report here.

Evans asked over 700 developers to rate leading application servers on over 21 attributes including performance, security, DB connectivity, scalability and support. Respondents had to have experience with the app server in order to rate it. Eight products were considered: Apache Geronimo, ColdFusion, JBoss, Netweaver, Oracle WebLogic, Sun GlassFish, WebSphere Application Server and Windows Server.

Apache Geronimo came in at #2, the highest ranked open source application server by developers. This warms my heart since I used to be the product manager for WebSphere Application Server Community Edition (WAS CE). Many of you know that WAS CE is IBM’s distribution of Apache Geronimo. It’s been an uphill battle for the Geronimo community, but this is an achievement they should all savor.

Since we’ve discussed #2 in the rankings, let’s turn to numero uno. The #1 application server as ranked by developers is…drum roll please…WebSphere Application Server (WAS).

It’s one thing for WebSphere to be ranked highly by IT decision makers. This is an audience that IBM resonates with. But this survey is based on respondents who have actually used the products, namely developers. Yes, early versions of WAS (i.e. v3.5) were not the slickest or easiest to use. But we’ve focused on changing that perception over the past 5 years. The Evans study is proof that we’ve made significant progress. With IBM WAS version 7 released last week, I’m extremely confident that developers, and their peers on the operations team, will be even more impressed with WebSphere going forward.

I do not want this to be a ra-ra-IBM post. Many of you know that I don’t cover IBM news very much here. Additionally, readers will note that I usually write positive things about “my competitors”. I’ve always believed that strong competitors are a customer’s nirvana.

I do however, want to take a minute and repeat what I believe will be the most successful strategy for software vendors over the next decade. Providing customer choice that includes free/open source options.

A keen eye on developer and administer needs has been at the heart of WebSphere’s success. However, by itself, this would not have been enough. I strongly believe that our embrace of free/open source is the reason that WebSphere grew while other closed-source vendors had challenges against JBoss.

Offering Geronimo/WAS CE and the proven WAS family gave customers choice. Outgrowing the market is evidence that choice resonates with customers. The Evans study is icing on the cake that speaks to the quality of products that our customers have been choosing.

[UPDATE 2009-01-05: PLEASE see Eduardo’s comment about the Evans not weighting the results by # of respondents. I think that is a mistake on the part of Evans from a pure market research standpoint].

News from Sacha (and covered by InfoWorld) that JBoss Application Server 5.0 is close to GA kicked off a debate at TSS.  Some commented that they were “Suspicious of anything that takes three years to develop”, while others questioned if there was anything new in JBoss AS5 that SpringSource and GlassFish (or for that matter Apache Geronimo) hadn’t already delivered.  Others congratulated JBoss on closing in on JEE5 certification and refactoring their runtime to be more flexible.

What caught my attention is the way that Sacha (JBoss CTO) responded to two comments from Douglas Dooley.

When Douglas suggested that JBoss shouldn’t talk about the new microkernel in JBoss AS5 when the real value is in Java EE5 delivered in JBoss AS5, Sacha replied:

“Again, read my blog: we are perfectly aware that many of our customers are using very different APIs to leverage our AS services. Most of them rely on EE, some of them on Spring, etc. And that’s fine. I don’t really mind which “wrapper API” they are using: we are here to support them in their preferred scenarios. What matters is how flexible our underlying foundation is so we are able support these multiple scenarios.”

When Douglas commented that JBoss should ditch their work on other OSes and focus on Linux, Sacha replied:

“No worries, we are doing more than fine. But we are certainly NOT going to ditch support for other OSes: we have a significant portion of our users going in production on Solaris, Windows, etc. and again, that is a matter of choice – we won’t dictate that.”

Why did these responses catch my attention?  Well, it’s not because of the technology decisions that JBoss appears to have made.  The move towards a flexible app server has been going on for years and it’s where the industry is headed.  For example, we’ve been down the flexible foundation path since WebSphere Application Server 6.1 two years ago (with more to come in the next release of WAS due out later this year).  The reason is because Sacha focused on customer choice. Even though we compete, I have a lot of respect for Sacha. He’s way to smart to let dogma get in the way of meeting customer needs. The internal decisions that led to JBoss AS5 and the messaging around the product appear to be a direct result of Sacha (and team) understanding what customers truly seek and where they want to head (i.e. JEE isn’t the answer for every problem).

I’ve long written about how WebSphere has been able to grow significantly faster than the market because of our focus on customer choice.  At times this focus stretches us a little too far as we try to reach the largest set of customers with whatever makes sense for that customer. This decision is not easy on the internal organization, but it really resonates with customers (as our revenue can attest to).

As a proponent of OSS, I’m very happy to see JBoss moving in this direction.  As an IBMer who competes with JBoss AS, I say bring it on ;-)

Some of you know that I’ve decided to track the demise ;-) of the traditional software market on a quarterly basis using IBM’s WebSphere branded revenue as the basis. I use the WebSphere division for no other reason than it’s the part of IBM that I report into. Here are the 2Q07, 1Q07, 4Q06 and 3Q06 posts if you fancy. IBM announced 3Q07 results today.

A few points of interest from 3Q07:

  1. IBM Software grew at 6% (or 3% at constant currency: i.e. if currency exchange rates were fixed to equal their 3Q06 rates)
  2. WebSphere branded middleware grew 10%
  3. IBM’s other Software families grew 9%, 3%, 5% and 9% for Lotus, Rational, Tivoli and Information Management respectively

WebSphere middleware growth of 10% is the lowest we’ve reported in the past year. However, considering the growth we attained in 3Q06 (i.e. 30% Y/Y vs. 14% in 3Q05 & 3Q04), it’s not surprising that 3Q07 growth wasn’t in the 15%+ range. Remember that the 10% is growth off a large revenue base, which unfortunately, IBM does not make public. But, if you have access to Gartner or IDC data, you can easily get to a ballpark number of total WebSphere branded revenue.

WebSphere Branded Middleware Quarterly Revenue Growth:

Quarter Y/Y Qtr Growth From:
1Q04 24% Source
2Q04 N/A Source
3Q04 14% Source
4Q04 18% Source
1Q05 11% Source
2Q05 18% Source
3Q05 14% Source
4Q05 4% Source
1Q06 26% Source
2Q06 17% Source
3Q06 30% Source
4Q06 22% Source
1Q07 14% Source
2Q07 28% Source
3Q07 10% Source

Fourth quarter is going to be interesting!

Some background:

  1. Matt asked “Why doesn’t Oracle just buy Red Hat?”
  2. I explained why Oracle would not buy Red Hat
  3. Luis Villa replied to Matt’s question: “Because Red Hat employees would leave en masse.”
  4. Microsoft announced fiscal 4Q07 growth of 13% on Thursday (or 16% if you only count their true software revenue – which falls into the “Client”, “Server & Tools” and “Microsoft Business Division” reporting categories). Microsoft crossed the $50 billion total year revenue mark with the close of fiscal 2007.
  5. I compared Red Hat’s stock performance over the past year vs. some Traditional software vendors (see below)

If you’re still with me….

Red Hat is growing and executing well. Financial analysts expect Red Hat to hit $517M this year (fiscal 2008, ending Feb. 2008), and $631M in fiscal 2009. At this pace, Red Hat should cross the $1 billion revenue mark in fiscal 2011. Red Hat may well be the gorilla in the Open Source marketplace. But after everything is said and done, that marketplace is tiny in comparison to the total software market. If you believe in the stock market’s ability to predict a company’s future value, one could argue that Red Hat investors are in a “sit tight” mode right now. At a P/E of 72 and PEG of 1.44 (vs. Google’s PE of 45 and PEG of 0.99), Red Hat’s stock has likely priced in as much growth and “great news” that we could think of. Few doubt Red Hat’s position in the overall OSS market, but some may be waking up and asking whether being #1 in 1.8% of the software market is enough to drive the multiples that Red Hat shares enjoy today.

While both vendors have strong operating system franchises, Red Hat isn’t really eating into Microsoft’s revenues. IDC predicts that the Linux & Windows markets are growing 26% and 9%, with Unix revenues declining by 3% from 2006-2011. Red Hat’s Jboss division adds a JEE portfolio that does compete with .NET as the infrastructure for enterprise applications. But here again, it’s very unlikely that Microsoft faces off against JBoss in (m)any customer deals. It’s more likely that Microsoft competes against IBM WebSphere, BEA WebLogic or Oracle AS, and JBoss only comes into the picture when the customer has already selected JEE. While there is some overlap, Red Hat is much more complimentary to Microsoft’s offerings than we’d like to think.

Just imagine a Microsoft that could offer customers a choice of Windows/.NET, Linux/JEE or, and here’s the magic, BOTH. The fact is most customers have heterogeneous environments, and those that don’t today, will likely in the future.

In the face of OSS competition, one of the best moves we made in the IBM WebSphere division was purchasing Gluecode. As I’ve mentioned (over and over), having a free application server, based on the open source Apache Geronimo project has done nothing but spur the growth of our overall WebSphere Application Server family. In some cases, the customer chooses WAS CE, in other cases, they choose Traditional WAS products. We help customers be successful with their choice and, equally important, ensure that their previous investments in WebSphere infrastructure are protected. This is exactly the scenario that Microsoft could create for themselves. Microsoft would be able to offer Windows, Linux, .NET or JEE in various combinations to solve customer problems. As a competitor, this would be a scary combination.

What’s more, Red Hat could help Microsoft gain OSS street cred almost instantly. To me, this would easily become Red Hat’s most important contribution to the software industry. Forget being #1 in 1.8% of the software market. How about helping a $50B software company evolve its thinking around OSS in order to become a $75B software company while increasing customer choice and satisfying customer needs? Goosebumps.

I doubt this acquisition will ever take place for three reasons. First, because of vendors such as IBM, HP, Intel and Oracle who have investments in/with Red Hat. Second, because Microsoft wouldn’t want to take the risk. I’d argue that there is much less risk than appears on the surface. Sure, there would be some internal friction during product positioning discussions if the deal went through. But internal friction is healthy and shouldn’t get in the way of helping customers succeed with your offerings. Lastly, as Luis’ comment highlights, Red Hat’s culture would also pose a barrier to this deal. But I’d argue that the only thing that these comments do is put a damper on the deal price, which, at the end of the day, is bad for Red Hat investors. One could argue that JBoss employees felt the same way about Red Hat prior to the acquisition. And yes, some left Red Hat, but some stayed. It would be up to Red Hat management to convince employees about the historic importance of their efforts inside of Microsoft, which would be a pretty compelling reason to stay.

A Red Hat marketing slogan states: “truth happens”, what about “change happens”? And why not help Microsoft change?

PS: I truly doubt this deal will ever happen, but it’s interesting to think about the possibilities.

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