IBM is spending €2.13 billion (about $2.3 billion) to buy two data integration tools from the German company Software AG. This is a cash deal. IBM will now own StreamSets, a data integration platform recently acquired by Software AG, and WebMethods, which Software AG purchased for over $500 million in 2007.
It’s important to mention that Software AG was bought by Silver Lake earlier this year. Initially, Silver Lake acquired 63 percent of the company for $2.4 billion, and in September, they increased their ownership to over 85 percent. Now, Silver Lake has bought 93 percent of Software AG and plans to remove the company from public stock markets soon.
IBM Acquiring Software AG Toolsets
For IBM, acquiring Software AG’s integration platform-as-a-service (IPAAS) toolset aligns with its larger strategy of embracing the hybrid cloud. Over the years, IBM has reinforced this approach through significant acquisitions, such as the $34 billion purchase of Red Hat in 2018 and the more recent $4.6 billion deal to acquire Apptio in June.
While cloud computing offers various advantages for companies, there’s been a growing preference to avoid being tied to a single vendor or cloud environment. Instead, companies are leaning towards a hybrid approach. This involves using local in-house infrastructure for security and lower-latency purposes, while also utilizing one or more public cloud providers for specific resources when needed.
However, this entails the challenge of handling and analyzing data spread across various applications stored on-premises and in multiple private or public clouds. This is where data integration systems come into play. They enable companies to create pipelines capable of consolidating data, no matter its location or format.
Essentially, IBM is acquiring, through StreamSets and WebMethods, technologies that cover the different layers of application and data integration. This includes API management, a specific capability that WebMethods contributes to the overall package.
IBM’s Advancements in AI
Data is crucial in the realm of artificial intelligence (AI), and like many businesses today, IBM has been enhancing its AI capabilities. This year, the company introduced a new data science platform named Watsonx. It provides tools for developing and deploying AI, along with managing all data sources in a unified platform. IBM’s recent pair of acquisitions will also play a role in this context.
According to Rob Thomas, IBM’s senior VP for software and chief commercial officer, in a press release, “Combined with IBM’s Watsonx AI and data platform, along with its application modernization, data fabric, and IT automation products, StreamSets and webMethods will assist clients in unlocking the full potential of their applications and data.”
Conclusion
IBM’s strategic move involves a €2.13 billion acquisition of data integration tools from Software AG, reinforcing its commitment to the hybrid cloud. This aligns with IBM’s broader strategy, addressing the evolving preferences in cloud computing. The company is also advancing in AI with the Watsonx platform, further enhanced by recent acquisitions.
