Announcing IBM’s planned $34 billion acquisition of Red Hat, the largest software transaction in history, the Red Hat Executive Vice President Paul Cormier was ebullient.
With two days to go until Halloween, the open source veteran in a blog late Sunday noted how the festival’s always been a good time of year for the company.
(You don’t get better treats than $34 billion.)
Painting a picture of the early, idealistic open source software movement, he noted in a potted Red Hat history that the company was one of the first to find a way to monetise products predicated on having freely available, open source code.
“Red Hat was founded in 1993 and the first release of Red Hat Linux was on Oct. 31, 1994. That became known as the Halloween release, and Halloween remains a holiday that Red Hatters celebrate,” he wrote.
In a paean to the rise of the open source, he emphasised that Red Hat was among the first to find a successful business model for Linux and open source.
Painting a picture of the company’s community some two decades ago, he noted that when he joined the company in 2001, Red Hat Linux was freely downloadable on FTP sites; if you had the bandwidth.
“Users of our products were pushing the limits of what the technology could do while relying on the open communication of the blossoming Internet for both motivation and support. If a piece of hardware wasn’t supported, if a bug was found, if a security hole was uncovered; our users, often coding at night from their homes, were the first line of discovery and resolution. We were a community with a small group of early adopters coming together under the Red Hat brand.”
IBM buying @RedHat is not about dominating the cloud. It is about becoming an OSS company. The largest proprietary software and tech companies in the world are now furiously rushing towards the future. An open future. An open source software driven future. OSS eats everything.
— Joseph Jacks (JJ) 🇺🇦 (@josephjacks_) October 28, 2018
Red Hat History: We Made a “Bet the Farm” Decision
“[But] In 2002, we made a ‘bet the farm decision’ to separate our commercial open source products from our continued investment in building open source projects.”
“We moved away from our freely downloadable and boxed Red Hat Linux, replacing it with an enterprise subscription model and retaining the open source principles of freedom while creating a long-term sustainable business model.”
He added: “That release was Red Hat Linux Advanced Server. The following year, we rebranded it as Red Hat Enterprise Linux and the rest is history…”
“Red Hat found a successful business model for Linux and open source, while further empowering our ability to invest and innovate in the Linux community through projects such as Fedora. That’s still our model today (expanded greatly) and was one of many moves that we made to put open source in the position that it is today.”
A Spookily Good or Frightful Cultural Fit?
Red Hat is a major player in the “behind-the-scenes” construction of cloud services. It offers a rapidly growing range of tools that make it easy for companies to build and orchestrate cloud-like platforms in their own data centers, or manage applications that run on multiple different cloud computing services; crucial in an era of “hybrid cloud”.
While what looks like a powerful commercial move by IBM, with product suites that complement each other nicely and a long-standing partnership, some have questioned the cultural fit: Red Hat comes from a more free-wheeling open source background, while IBM has a more corporate and hierarchical culture.