Cloud computing has emerged as the fastest-growing market in technology. The tech world is witnessing the dawn of a new age where more agile, robust, and cheaper cloud architecture is making traditional data management obsolete. With growing data, the cloud not only helps store terabytes of data, it provides a gateway to a world of new tools that make data management and traversal easier than ever. The cloud is simply evolving and its applications remain endless. With a scope so wide, several enterprises are working on exploring the cloud and release innovative solutions to one-up each other. That’s not all — acquisition of cloud-based companies has become the norm in the market. Various enterprises have spent billions acquiring companies that proved their potential. So, let’s look at some of the biggest cloud computing acquisitions of the last year.
1. IBM-Red Hat
Red Hat is a 25-year-old company that’s most popular for its Red Hat Enterprise Linux and open source technology used in datacenters. Red Hat was valued at $20.5 billion before IBM acquired it for a massive $34 billion. This deal is the largest ever made by Big Blue, and Red Hat is part of IBM’s hybrid cloud division. Together, both companies will provide an open approach to the cloud, providing users with remarkable security and portability across various clouds. Announced in October 2018, this effort puts IBM at the No. 1 rank in the hybrid cloud market.
As for Red Hat, it will continue its open source venture while drawing on IBM’s hybrid cloud to expand globally. IBM plans to stay committed to Red Hat’s open source model and empower its vast developer ecosystem. Together, they will continue in building partnerships with major cloud vendors including Amazon Web Services, Microsoft Azure, Google Cloud, and others. There is hesitation among enterprises to move towards the cloud because of the proprietary nature of the cloud market. IBM and Red Hat plan on providing unique and seamless solutions that will make portability across different clouds easier.
Salesforce is a big name in the cloud market and is sprinting to the top as a cloud vendor. This customer relations management (CRM) software helps users manage interactions with customers that can help businesses grow. Salesforce acquired Mulesoft, which went public in 2017, for $6.5 billion in the spring of 2018. Mulesoft helps customers link their databases, applications, and IT infrastructure in a single, unified system. Mulesoft had incurred losses in business since it went public.
In a need to grow and expand, Salesforce will embed Mulesoft in its Salesforce Integration Cloud so that customers have easy access to corporate data. This comes after Salesforce’s plans to acquire LinkedIn in order to have easy access to corporate data were quashed by Microsoft when it bought LinkedIn a few years ago. Salesforce plans on using this data to grow its AI endeavor called Einstein.
SAP completed the acquisition of Callidus Software for $2.4 billion in 2018. This wasn’t a surprising move considering Callidus has around 5,800 customers who use its services such as sales, lead to money systems, cloud-based human resource software, and customer experience solutions. SAP and Callidus have been sales partners for a while and this acquisition is a very smart move by the ERP giant. CallidusCloud, bundled with SAP Hybris, will be the part of SAP’s Cloud Business Group. This move will help SAP cement its position as a CRM leader.
This acquisition also allows SAP to provide front office solutions that can help enterprises strategically expand and grow. This intelligent customer suite will help in SAP’s shift to become a cloud service provider. SAP has a large global footprint and with the help of Callidus, it can provide modern solutions to users for which they had to turn to Salesforce among other CRM software providers.
4. Cisco-Duo Security
Cisco is trying hard to build its cloud business. As the leader in networking hardware, it is now finding ways to plunge into the cloud. One of the biggest reasons people are skeptical of building on the cloud is security. Sure, it’s cheaper than having to maintain datacenters, but some enterprises still want to make sure their data is secured without any compromise. Cisco is new in the cloud market but is all set out to address concerns of the ever-growing threat of cyberattacks looming over businesses. Duo helps customers by securing employees’ online accounts with a two-factor authentication tool which helps keep user’s accounts safe.
This is not the first time Cisco has acquired a promising security business. In the past, Cisco acquired firms like Sourcefire and Threatgrid among others. The pace at which security startups get acquired will only pick up in the future as cybersecurity becomes the first priority of any cloud vendor out there. After this acquisition, Cisco’s security unit saw a year-over-year growth of 11 percent, which is a testament to how much value security holds today.
5. Workday-Adaptive Insights
Workday provides back office solutions to businesses which include its popular human resource application. Workday paid $1.55 billion to acquire Adaptive Insights. Founded in 2003, Adaptive Insights has emerged as a leading cloud-based planning software. With more than 3,800 businesses using its services, Adaptive Insights helps organizations of varying sizes to make decisions that help them hold an edge over their competitors. This acquisition will help Workday provide its customers with advanced modeling capabilities.
Workday and Adaptive Insights have been working as partners since 2015. Workday plans on using Adaptive Insights’ technology to improve its human resource solution as well as to work on its future prospects based on planning. Customers will be able to plan, execute, and analyze across enterprises on a unified system which will help them accelerate their financial transformation.
Datorama, a 6-year-old Israel-based startup, has been a popular name in the marketing sector. It provides marketers with insights into advertising and marketing data on a consolidated interface. This platform uses artificial intelligence to extract insights from data sets of different sizes. These insights can help customers optimize their marketing efforts in order to get better results.
Salesforce acquired Datorama for $800 million. This step will help Salesforce become a leader in marketing solutions. It plans on using Datorama’s technology to achieve greater data integration, intelligence, and analytics. Customers will have better insights from marketing, CRM, and other clouds.
Cloud computing acquisitions: Staying relevant
2018 saw a massive increase in strategic cloud computing acquisitions and this trend can be traced back to the cloud’s growing demand. Businesses realize it’s a crucial time to evolve and to innovate. It’s not just a war to become the greatest; it’s a war to stay relevant. Today’s tech will get obsolete tomorrow and no good can come from dwelling on a particular business model or technology. There’s cut-throat competition and businesses that manage to acquire or create the right technology have the upper hand.
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