Friday, May 15, 2009

Whats up with the MegaCorps buying up smaller companies?

Recently a few articles on ZDNet have upset me. I began really thinking hard about this when Oracle announced it's buyout of Sun Microsystems. Predominantly they are buying a company that is in direct competition with them. Ok, I guess this is what large companies have done for years. The problem is the technologies are not compatible. So will Oracle lose their own DB business or kill MySQL. By the way, MySql is open source. There are already a couple of projects underway that reduce some of the issues with MySql and are completely compatible with that product. Did Oracle by Sun for Java. It has also been open sourced. Aside from that their are also a number of other projects that are reimplementing the runtime and development environments. So there is no benefit there. Maybe it was Solaris. That being the case MySql and Java may just be on the chopping block. So you've got two poorly managed companies merging into one monster company with no clue as to direction. I just don't see this as a truly compatible purchase.

Now Larry Dignon over at ZDNet is talking about big blue buying Red Hat? First off, I am not sure IBM is that stupid. Second... why? I will give you that IBM spends billions on Unix and Linux development, but we are talking about a company worth over $130 billion? Red Hat maybe sits at a lil over $3.5 billion. With heavily overlapping product lines. So would IBM drop AIX or RHEL? I don't see them keeping both. Also Red Hats JBOSS directly competing with an IBM's WebSphere product. The only benefit here is picking up Red Hat's support contracts paying an estimated $167 million a quarter. Wouldn't big blue consider that pocket change. Then they have to spend a few billion while "realizing synergies." I just don't see it. IBM already does everything Red Hat does and a whole lot more. Where would IBM benefit from this acquisition?

This whole fiasco is reminiscent of recent posts regarding Apple, Inc (formerly Apple Computer Corporation). A simple search a ZDNet for the one word 'apple' will turn up a host of negative blog posts regarding Apple and their corporate philosophy. The thing is they are making money hand over fist. Gross revenues up 25% over last year and net profits up 18%. That tells me they are doing just fine. Okay, so they are not Microsoft. They ain't trying to be! Personally, I would certainly be happy with second place. Even if second place meant only a 7% market share. That second place earned Apple over $4 billion last year. Likely even more this year. Nothing wrong with that

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