This is a weekly browsing of recent relevant industry news articles, helpful for educating ourselves as well as for sharing with our peers. Please post any thoughts in the comments section!
Oracle Corp. agreed to buy NetSuite Inc. for $9.3 billion, bolstering the software maker’s cloud-computing offerings as it races to catch up to rivals. Oracle is paying $109 in cash for NetSuite, a 19% premium to the company’s closing price Wednesday of $91.57. The deal is expected to close in 2016, subject to regulatory and shareholder approval. The deal, among the largest in Oracle’s history, reunites Chairman Larry Ellison with Zach Nelson, NetSuite’s chief executive, who ran Oracle’s marketing operations in the 1990s. Mr. Ellison is NetSuite’s largest investor; entities owned by Mr. Ellison and his family held nearly 40% of NetSuite’s shares, according to NetSuite’s annual proxy statement filed in April.
When it comes to cloud computing, Google is in a very unfamiliar position: seriously behind. Google is chasing Amazon and Microsoft for control of the next generation of business technology, in enormous cloud-computing data centers. Cloud systems are cheap and flexible, and companies are quickly shifting their technologies for that environment. According to analysts at Gartner, the global cloud-computing business will be worth $67 billion by 2020, compared with $23 billion at the end of this year. “The world’s biggest maker of computer servers is making machines just for these guys,” said John Lovelock, a cloud analyst at Gartner. “It’s the nexus of things like big data, social networks and mobility, and the next big thing, which is artificial intelligence.”
OpenStack, the open source project that allows enterprises to run an AWS-like cloud computing service in their own data centers, added support for containers over the course of its last few releases. Running OpenStack itself on top of containers is a different problem, though. Even though CoreOS has done some work on running OpenStack in containers thanks to its oddly named Stackanetes project, that project happened outside of the OpenStack community and the core OpenStack deployment and management tools. Soon, however, thanks to the work of Mirantis, Google and Intel, the OpenStack Fuel deployment tool will be able to use Kubernetes as its orchestration engine, too. Ideally, this will make it easier to manage OpenStack deployments at scale.
IDC defines cloud systems management as software tooling with the following functionality: Workload scheduling and automation; change, performance and event management; and troubleshooting. IDC expects that by the end of 2017 80% of enterprises will commit to using hybrid cloud computing that uses multiple public cloud providers along with private cloud or non-cloud resources, IDC’s report states. “Customers are using this transition to reevaluate and streamline their in-house management software,” the Worldwide cloud systems management software market share report notes. Overall, IDC says the cloud systems management software was a $2.9 billion market in 2015, up almost 25% from the year prior. VMware held the top market share with 22.6% of the market. IBM had the next highest at 12.9% and Microsoft was right behind IBM at 12.6%. Microsoft had the fastest growing market share for cloud systems management, up 34% compared to VMware growing at 27.9% and IBM only growing at 8.1%.
Amazon.com Inc. is showing investors it can be consistently profitable while making big investments to challenge competitors in the U.S. and expand around the globe. The Seattle-based company reported second-quarter earnings that topped analysts’ estimates, while spending on quicker delivery to keep ahead of Wal-Mart Stores Inc. and other brick-and-mortar retailers, expanding its entertainment offerings to challenge video-streaming rival Netflix Inc. and pouring money into India to take on e-commerce competitor Flipkart Ltd. It’s a new chapter for Amazon, which has previously entered money-losing cycles with big investments in pursuit of growth. The company Thursday reported its fifth-straight profitable quarter while operating expenses rose 28 percent to $29.1 billion.