| Red Hat completes JBoss acquisition |
Jun. 05, 2006
Red Hat Inc. is the world's best known Linux distributor, but with its acquisition of JBoss completed on June 5, it also wants to become a well-known SOA (service-oriented architecture) company.
The Raleigh, NC-based Linux distributor had announced on April 10th that it had entered into a definitive agreement to acquire the open-source Java middleware company, after months of rumors that JBoss had been looking for a buyer.
The final price, according to Timothy Yeaton, Red Hat's Senior VP of Enterprise Solutions, is $420 million. This will be made up of 40 percent cash and 60 percent Red Hat stock. This is $70 million more than the original estimate.
When the deal was first announced, Red Hat officials had said that an additional $70 million might be paid depending upon JBoss's financial performance. Oracle had been alleged to have been looking to pay up to $480 million for JBoss.
Starting immediately, JBoss has become a division of Red Hat. Customers will now have access to a single, "proven" global production support organization that can service both Red Hat and JBoss customers, in addition to procuring JBoss offerings through Red Hat's established global channels, according to Red Hat.
Yeaton said that "JBoss will be an autonomous division. There will be no office closings and we're keeping the entire core JBoss team."
For now, all JBoss and Red Hat support and sales contacts will stay the same, including escalation contacts and all contact information, the company says. Additionally, customers who have both Red Hat and JBoss subscriptions can use either support channel, and the company will route issues to the appropriate support contact as needed.
In addition, all JBoss support and subscription contracts will be honored.
For online updates, Red Hat will continue to offer and support both RHN (Red Hat Network) and the JBoss Operations Network. In the future, however, the company will consider integrating the two support and update networks.
The company will not, however, be merging the JBoss code base into RHEL (Red Hat Enterprise Linux). In addition, JBoss will continue to support multiple platforms. That said, Red Hat may opt to have JBoss products take advantage of specific RHEL features.
One program that Red Hat will no longer be actively supporting, however, is the JOnAS-based application server. Instead, it will consolidate its efforts behind JEMS (JBoss Enterprise Middleware Suite). Red Hat will continue though to honor its existing subscription and services agreements.
Red Hat will continue to support customer choice and work with customers and their preferred middleware ISVs (independent software vendors). So, for example, a customer running JOnAS for its Java-based Web services on RHEL could still expect Red Hat support.
The company, however, will no longer be selling new JOnAS subscriptions. Yeaton said, "We expect many current JOnAS users to want to switch to JEMS, buy we'll continue to support those that don't."
Marc Fleury, founder and former CEO of JBoss and now senior VP and general manager of the JBoss division of Red Hat, said in a statement: "Joining forces with Red Hat makes absolute sense for JBoss employees, customers, partners and the community as a whole. We share a common passion for innovation, technology and open source. Red Hat will give JBoss a platform to grow, so we can both continue to deliver exceptional open source products, services and customer value."
The customers of both companies are looking forward to the merger taking effect. "At Orbitz, we currently use both JBoss Application Server and Red Hat Enterprise Linux. We believe the acquisition of JBoss and its integration with Red Hat will support our efforts to be more cost effective as we develop and deploy applications," said Chuck Clark, director of platform technology for Orbitz, the online travel agency. "We look forward to a more seamless integration of JBoss middleware components with Red Hat enterprise solutions."
Analysts also think that the deal should do well for the companies and their customers.
"The JBoss product portfolio is an excellent technology fit with Red Hat's current enterprise solutions," said Al Gillen, IDC's research VP for system software "The combination of Red Hat and JBoss will drive further innovations for the open source ecosystem -- yet by maintaining JBoss as a division, JBoss customers aboard other platforms should see continuity with the JBoss products they use."
-- Steven J. Vaughan-Nichols
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