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From Vizuri's Experts

[FAQ] IBM Completes Acquisition of Red Hat. Now What?

On July 9, 2019, IBM completed the acquisition of Red Hat for $34 billion, finalizing the third largest acquisition in the history of the US tech industry. But what will this mean for Red Hat’s customers, IBM’s customers, Red Hat Partners and their customers, and the future of both companies’ products?

This FAQ addresses questions posed to us directly by our customers and common questions seen around the Red Hat Partner space over the past nine months since the acquisition was first announced. If you don’t see an answer to your question in this FAQ, feel free to ask us directly.

More information is also available through this Q&A with Arvind Krishna, senior vice president of IBM Cloud & Cognitive Software, and Paul Cormier, Red Hat executive vice president and president of Products and Technologies.

Key takeaways

  • Red Hat will be a distinct unit in IBM. IBM is committed to preserving Red Hat’s independence, neutrality, culture, and partnerships. IBM and Red Hat will operate separate partner programs and cultivate distinct partner ecosystems.
  • Red Hat and IBM share the same goal of bringing more enterprises to the cloud via strong, organized, and proven cloud migration strategies and modern software architectures like microservices. This goal reinforces the notion that Red Hat will contribute better when allowed to continue to operate separately.
  • For customers and partners, Red Hat will continue to be Red Hat.

General questions about the acquisition

What will Red Hat's relationship to IBM be within the larger organization?

Red Hat will become a unit of IBM’s Hybrid Cloud division. Red Hat CEO Jim Whitehurst will be joining IBM’s senior management team.

How does IBM plan benefit from acquiring Red Hat?

The reasons behind IBM’s acquisition of Red Hat are largely tied to the answer for the question below regarding the future of Red Hat products and the above answer regarding Red Hat becoming a unit of IBM’s Hybrid Cloud division.

The main motivator for this move that we have seen so far is the opportunity to expand IBM’s hybrid cloud offering and become a distinguished leader in the space, armed with Red Hat’s leading-edge enterprise open source software products. IBM seeks to position itself at the intersection between open source and hybrid cloud to usher in the next generation of digital innovation. Read more about it in this press release from IBM.

How does Red Hat plan to benefit from this acquisition?

Open source is at the heart of all of Red Hat’s business. The acquisition is an opportunity for Red Hat to further its mission to bring open source to the enterprise and make open source the standard for software development. It also gives Red Hat an unparalleled chance to reach an expanded market for their open source and hybrid cloud solutions as organizations increasingly move toward open source technologies. This, in turn, gives Red Hat the opportunity to take their open source technologies further than ever before.

What have you heard regarding Red Hat products and their future?

The crown jewel of this acquisition seems to be Red Hat OpenShift Container Platform, Red Hat’s Kubernetes distribution. It will give IBM a needed stepping stone in the form of cloud migration offerings. Recognizing how large, unwieldy architectures have prevented enterprise applications from moving to the cloud, the utility of containers is something that IBM can no longer go without in their effort to become a leading force in hybrid cloud.

IBM has expressed that OpenShift and Linux specifically will be the primary platforms on which they will develop and deploy software, both for cloud and on-premise. IBM will optimize their middleware, AI, and data products to run on these platforms to enable a standardized infrastructure for on-premise, hybrid/multi-cloud infrastructure, and microservices application architectures.

As Red Hat will remain a distinct unit within IBM, they will continue to independently offer their own products. IBM has expressed to multiple outlets its commitment to preserving Red Hat’s open source culture and mission.

Questions about impacts on Vizuri, Red Hat Partners, and their customers

Will Red Hat Partners continue to be able to sell Red Hat products?

Yes. There is no planned change to the Red Hat Partner Program. Red Hat will continue to maintain its own separate partner program.

Will Vizuri also sell IBM products?

Yes, since we recently became an IBM Partner, we will also sell IBM products. However, please note that other Red Hat Partners, unless they also have IBM Partner status, will not sell IBM products. 

Will Vizuri continue to be a Red Hat Partner and work with customer accounts?

Yes, we are continuing our partnership with Red Hat and do not expect any significant changes to the Red Hat Partner Program.

What does this acquisition mean for customer relationships with Vizuri? Will customers’ point(s) of contact remain the same?

We do not expect any changes to the Red Hat Partner Program and Vizuri will continue doing business as usual. Accounts will experience no changes and customers should continue to connect with their established Vizuri point of contact. We appreciate your business and value our relationships with you. Reach out to your account manager any time if you have any questions.

Zack Belcher

Zack has over 9 years of experience selling Open Source Software and consulting services. He specializes in Open Source Solution sales, product configuration analysis, and business development.