The acquisition of open source middleware vendor JBoss Inc. by Linux trailblazer Red Hat Inc. will forge a major new SOA vendor, according to the CEOs of the two companies during a teleconference yesterday announcing the deal.
However, neither Matthew Szulik, chairman and CEO of Red Hat, nor Marc Fleury, CEO of JBoss, could provide a detailed product roadmap, indicating that the integration of the two companies products would take some time. They were not even able to say for sure that the JBoss product names will be retained when the $350 million deal is completed.
Analysts did agree with the CEOs that there is synergy between the companies' open source software subscription and service business models and that the Red Hat/JBoss product could make the new company a major player in the SOA software game.
Dana Gardner, Principal Analyst, Interarbor Solutions, LLC, said the combined Red Hat/JBoss puts them in the league with IBM, BEA, Oracle and Microsoft. Noting that the SOA market is "in some turmoil," he said there was room for "a new entrant" and Red Hat/JBoss might be it.
Fleury, who will run what will become the JBoss division of Red Hat, said the combined companies will provide an SOA infrastructure that gives developers choice in tools ranging from Java to .NET to PHP.
"This announcement is clearly focused on the infrastructure part of open source," he said. "This is where Red Hat and JBoss have proven success. We're definitely focused on the infrastructure of the SOA platform."
When asked specifically about the LAMP (Linux Apache, MySQL, PHP) programming model, Fleury placed it in the context of his theme of choice.
"In terms of the programming model, JBoss has been working with technologies such as Java first and foremost, and also .NET through a partnership with Microsoft, and recently announced JBoss Web with the .NET programming model," he told analysts and reporters. "We also have support for the PHP programming model, which gives the P part of the LAMP stack. So you have the JAM stack -- Java, Apache and MySQL -- and the LAMP stack. So what you will see from us going forward is an embrace of the LAMP programming model, making it robust, taking it to the enterprise level in terms of scalability, reliability and security, as well as the .NET programming model in terms of front-end development."
However, not all analysts see it exactly that way.
Asked if the JBoss tools might form a bridge from LAMP to SOA, Jason Bloomberg, senior analyst at ZapThink, LLC, replied, "I don't think so. Red Hat offers 'L' -- Linux, and JBoss offers 'A' -- Tomcat, but neither offers the Apache Web Server, MySQL or PHP/Perl as a core offering. So I'd say that Red Hat/JBoss is shaping up to compete with LAMP more than anything."
But Gardner with Interarbor sees the Red Hat/JBoss SOA products as more complimentary than competitive.
And Michael Goulde, senior analyst with Forrester Research, sees the two companies' combined products as "more of a high-end, enterprise solution" that does more than LAMP, although he is skeptical of the new JBoss products Fleury was touting.
"Red Hat had a strategy to offer three tiers of certified, tested stacks -- LAMP, Tomcat and J2EE (JonAS)," he said. "None of these, by themselves, provided everything you need for SOA. By acquiring JBoss, Red Hat is in a much better position to offer a complete SOA platform to customers, although the JBoss offering is new and unproven."
Szulik, who now becomes Fleury's boss, presented the big picture view of what the combined companies will offer for the future of SOA.
"I think what you're continuing to see is Red Hat respond to the demands of the customer," he said. "As they scale out horizontally to a grid-like infrastructure, they want a complete open source development model, the tools and then the service competence in a heterogeneous environment. So collectively we're very excited to deliver that."
Analysts seemed to agree that Red Hat/JBoss makes business sense in the disruptive world of SOA. Wall Street initially liked the deal, as after the Monday announcement Red Hat stock on Nasdaq closed up $2.42 or 8.82% to $29.85. JBoss is privately held. Gardner said the stock market reaction was unusually positive because in most deals the acquiring company's stock goes down.
However, there was skepticism among analysts about the claim in Monday's announcement that: "By acquiring JBoss, Red Hat expects to accelerate the shift to service-oriented architectures (SOA) by enabling the next generation of Web-enabled applications running on a low-cost, open source platform."
"Well, it may help accelerate Red Hat's shift to SOA," said Forrester's Goulde, "but there isn't anything inherent in the acquisition that will accelerate customer's shift. JBoss' ability to accelerate adoption of SOA will depend on how well it executes on its SOA strategy. This will entail JBoss delivering a complete, high-quality, manageable, secure platform for SOA development, along with the services customers require that are often hard to obtain for open source. Combining the Red Hat and JBoss brands will produce a powerful, global brand for open source, although the ultimate structure of the company and its offerings remain to be seen."
Zapthink's Bloomberg sees the deal as a potential win-win-win-win.
"From Red Hat's perspective, they are now able to leverage JBoss's efforts to put together a suite of open source SOA infrastructure products," he said. "From JBoss's perspective, they are now able to leverage their suite into Red Hat's customer base. From the commercial vendors' perspective, Red Hat/JBoss represents a more formidable open source alternative, pushing them to add value at increasingly higher levels. And from the customers' perspective, the more they can get their open source selections from the same vendor, the lower their risk."