Posted By Admin On Wed, Sep 25, 2019

IBM completed its acquisition of Red Hat for $34 billion on July 9, 2019. They are to maintain their independent operations and teams and Red Hat will remain placed within the Hybrid Cloud Division of IBM and reported under the Cloud and Cognitive segment of IBM. To preserve the neutrality, independence, and working of Red Hat, IBM will continue to consider it as distinct units. This helps them preserve their culture and work with their partners. 

Independent work space for both

Nine months have passed since they announced their strategic partnership and it is now time to take stock. The first and most important thing is that both IBM and Red Hat will run their own, separate partnership programs. The partner ecosystem for each will be different. This will help them deliver the best results they think. There is a big shift going on currently in the IT scene and the red hat cloud is going to influence the changes that take place. 

Benefits to each partner

The need of the customer is clear because of the obvious challenges. They need to move fast and use technology to differentiate. Their cultures need to be more collaborative and be able to develop highly flexible solutions. Open-source innovations come to the foe when the two Red Hat and IBM come together. The big question is how IBM benefits from the acquisition.

IBM will now have an extension of the cloud offered by Red Hat. This sharing of the hybrid cloud will help IBM develop an advantage in space because it is now armed with leading-edge software products from the enterprise open source segment of Red Hat. IBM will now be comfortably positioned between the hybrid cloud and open source which makes it ideal for digital innovations. 

Speed increased through container operations

The central piece of this merger of IBM with red hat cloud forms is the Red Hat Open shift Container Platform which is the Kuber netes distribution of Red Hat. Many kinds of cloud migration possibilities open up for IBM because of this. Huge unwieldy architecture prevents enterprise applications from using the cloud,which is why this container offering from Red Hat is a boon. The primary platforms for their operations will be Linux and Open Shift both on-premise and cloud.

All their data products, AI, and middle ware will remain optimized for these platforms. This will enable a standardized infrastructure for micro service application, hybrid-multi cloud infrastructure, and on-premise architecture. They do not plan to change the management or the operating team on both sides so Jim White hurst will continue to lead Red Hat Services while Ginni Rometty will lead IBM. 

Revenue shows improvement

Using strong organized effort and proven cloud technologies, the duo will attempt to move towards the common goal of bringing more enterprises to their cloud. This will also allow RedHat to contribute more by operating independently. In this year, the first quarter revenue showed a growth that crossed $19 billion. In the coming five year period, Red Hat will contribute two points compound annual revenue growth. The year-on-year fiscal growth of Red Hat was 15% amounting to $3.4 billion. Making the initial move towards the cloud is necessary but enterprises must now move mission-critical workloads and optimize everything.