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Linux: IBM Tries to Regain Relevance with Purchase of Red Hat

By Dick Weisinger

IBM recently announced acquisition of Red Hat for $34 billion.  That is the biggest deal ever for IBM and the third biggest tech acquisition ever.  RED Hat will become a unit of IBM’s Hybrid Cloud division which current Red Hat CEO Jim Whitehurst will manage and report directly to IBM CEO Ginni Rometty.

The deal is an attempt by IBM to catch up.  Profits at IBM have dropped for 22 consecutive quarters, and Warren Buffet and Jeffries Financial Group have cautioned against buying IBM stock.

Over the past twenty years Linux has moved from being a curiosity to being the engine behind almost all of the major technology companies.  It is used extensively by Facebook, Amazon, Alphabet/Google, and recently even Microsoft.

Jim Zemlin, executive director of the Linux Foundation, said that “Linux represents how effective open source is at delivering software better, faster, and cheaper.”

Ginni Rometty said that “the acquisition of Red Hat is a game-changer. It changes everything about the cloud market. IBM will become the world’s number one hybrid cloud provider, offering companies the only open cloud solution that will unlock the full value of the cloud for their businesses.”

IBM tried to reassure the many businesses that use Linux that their commitment to Open Source will remain. “With this acquisition, IBM will remain committed to Red Hat’s open governance, open source contributions, participation in the open source community and development model, and fostering its widespread developer ecosystem. In addition, IBM and Red Hat will remain committed to the continued freedom of open source, via such efforts as Patent Promise, GPL Cooperation Commitment, the Open Invention Network and the LOT Network.”


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