Oracle Acquires Nimbula–and by Default Becomes Part of OpenStack (OMFG)

Now this is one for the books, Oracle this morning announced that it has acquired cloud operating system vendor Nimbula who, only last November, announced that it was joining the OpenStack initiative. From the announcement:

Oracle announced it has agreed to acquire Nimbula, a provider of private cloud infrastructure management software. Nimbula’s technology helps companies manage infrastructure resources to deliver service, quality and availability, as well as workloads in private and hybrid cloud environments. Nimbula’s product is complementary to Oracle, and is expected to be integrated with Oracle’s cloud offerings. The transaction is expected to close in the first half of 2013.

Yes, the home of closed, proprietary, heavy and aggressive technology has acquired a lightweight open source product that is part of a “mutual gain” initiative. OMFG indeed!

MyPOV

Nimbula’s decision to join OpenStack was, in my view, partly inspired by the difficulty they had in gaining real marketplace traction. Other than Russian search giant Yandex, the enterprise deals were slow in coming to Nimbula – this despite the fact that their solution was actually very solid (no surprise given the founders of Nimbula built Amazon’s EC2 service in the past. By joining OpenStack, Nimbula got some much needed attention and recognition.

This recognition however may not have turned into significant revenue and I suspect the investors were starting to itch for a short term exit before cash levels started to get painful – fundamentally in the private cloud market it’s hard to convince people not to just “keep buying VMware

In acquiring Nimbula, Oracle gets some private cloud chops, the interesting thing will be to see whether they continue the approach of deploying Nimbula on commodity hardware or try and fudge it into their long standing and frustrating “cloud in a box” story. Much is unknown about the deal (not least of all the price paid) but it will be fascinating to see where it goes.

Disclosure – Nimbula’s VP of Marketing is an investor in a company that I’m also an investor in. I have no inside information on the Nimbula/Oracle deal however.

 

 

1 Comment
  • I agree with Mr. Kepes that Nimbula has an excellent pedigree but sales wins were probably lacking. I suspect that their capital burn rate eventually forced the decision to align with OpenStack and now to find a buyer in Oracle. Oracle can afford to put Nimbula Director on the shelf until they figure out what to do with it. Three years ago Oracle bought the virtualization management startup Virtual Iron and basically decided to consume the technology in-house. Oracle then dismissed the Virtual Iron partners and their customers. I would not be surprised if Oracle did the same with Nimbula Director.

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