devopsy.kinsta.cloud

Tag: acquisition

  • Chronosphere Acquires Calyptia to Process Log Data More Efficiently

    Chronosphere Acquires Calyptia to Process Log Data More Efficiently

    Chronosphere today announced it has acquired Calyptia to add additional pipeline management capabilities to its observability platform.

    Calyptia created Fluent Bit and Fluentd, a set of open source log processors that are now being advanced under the auspices of the Cloud Native Computing Foundation (CNCF).

    Chronosphere CEO Martin Mao said these log processors will be embedded into the company’s namesake observability platform to enable the routing, transformation and optimization of log data at scale. That issue has become problematic because cloud-native applications based on microservices create exponentially more telemetry data than legacy monolithic applications. If it becomes too costly to analyze that data, then DevOps teams will begin to limit the number of applications they will observe, noted Mao.

    The Calyptia platform achieves that goal using filters at the data source to reduce the volume of data that might otherwise be shared by 30% or more.

    The shared data can then be analyzed in real time rather than waiting for it to be stored and indexed. In addition, DevOps teams can enrich that data in flight to include additional context.

    Calyptia cofounder Anurag Gupta added that the primary mission for the company has always been to make log data more accessible to developers as they build and deploy applications.

    The acquisition of Calyptia comes on the heels of a log management alliance between Chronosphere and CrowdStrike through which a log storage and virtualization capability, dubbed Logs powered by CrowdStrike, has been added to the observability platform. The overall goal is to simplify the management and analysis of logs via a single click of a graphical tool or within the context of a larger DevOps workflow based on a command line interface (CLI) without requiring data engineering expertise, said Mao.

    It’s not clear how fully DevOps teams have embraced observability, but it’s apparent the legacy monitoring tools that collect a set of predefined metrics are not able to keep pace with the complexity of cloud-native application environments. An observability platform makes it simpler to query log data and discover the root cause of an issue—hopefully before a catastrophic event occurs. The challenge, of course, is providing that capability without incurring massive increased storage costs for log data.

    Despite those concerns, the need for observability is becoming a more pressing issue with each passing day. Organizations have never been more dependent on applications to drive revenue. A degradation in performance is usually an early indicator of a disruption that often has a direct impact on revenue and profitability.

    There is, of course, already no shortage of observability platforms. The issue most DevOps teams encounter is finding the funding needed to employ one at a time when organizations have become much more sensitive to IT costs. There may be an opportunity to rationalize some monitoring tools to help pay for the cost of a more modern observability platform, but regardless of approach, an ounce of prevention is always going to be worth a pound of proverbial cure.

  • Cisco Acquires Splunk to Create Observability Powerhouse

    Cisco Acquires Splunk to Create Observability Powerhouse

    Cisco today revealed it has signed a definitive agreement to acquire Splunk for $28 billion in cash. The deal will add Splunk, one of the most widely-used platforms for managing IT operations, to Cisco’s portfolio, joining the AppDynamics observability platform in addition to a wide range of IT infrastructure equipment.

    Chuck Robbins, CEO of Cisco, told industry analysts the combined entity will be one of the largest software companies in the world. The Splunk and AppDynamics platform creates a comprehensive observability platform spanning applications, networks and hybrid cloud computing environments, Robbins added.

    By combining AppDynamics with the data collected by the Splunk platform, the combined company will be able to provide greater insights into IT operations than any other company, added Robbins.

    Splunk CEO Gary Steele said the acquisition represents the next natural, logical step for Splunk and furthers its long-term partnership with Cisco to keep IT environments secure and resilient. The two companies will also be able to apply artificial intelligence (AI) more effectively to IT operations, he added.

    In its most recent quarter, Splunk reported revenues of $911 million, with cloud revenue accounting for $445 million, or 29%, of the total. Total Splunk revenues are forecasted to be between $3.925 billion and $3.95 billion for fiscal 2024.

    Splunk previously acquired SignalFX, a provider of an observability platform, in 2019. It’s not yet clear how the platform might be integrated into the AppDynamics platform, but Robbins said there is little overlap between the observability platforms the two companies currently provide.

    The Splunk acquisition comes at a time when it’s becoming more apparent that the need for observability extends well beyond DevOps workflows as organizations become more dependent on software.

    Each IT organization will need to determine how long it will wait for the Splunk acquisition to close before investing further in observability. Historically, acquisitions of this scale have been accompanied by price hikes to help fund the merger once the deal is concluded.

    In the meantime, IT and DevOps leaders will likely revisit the way IT is managed in the months ahead. Splunk came to prominence at a time when most workloads were running in on-premises IT environments. While the bulk of workloads continue to run in those environments, many workloads deployed in the cloud are being managed using platforms designed specifically for those environments. Splunk has been making a case for a hybrid cloud computing approach that assumes the management of on-premises and cloud computing environments will become more unified.

    In theory, economic headwinds are driving more organizations in that direction to reduce the total cost of managing IT. But it’s just as feasible to extend cloud tools to on-premises IT environments as it is to extend legacy tools to the cloud. Despite the inevitable outcome, Splunk rivals will spend the better part of the next year coming up with offers to switch platforms both before and after the deal eventually closes.

  • Buildkite Acquires Packagecloud to Streamline DevOps Workflows

    Buildkite Acquires Packagecloud to Streamline DevOps Workflows

    Buildkite Pty Ltd today revealed it has acquired Packagecloud as part of an effort to tightly integrate package management tools with its continuous integration/continuous delivery (CI/CD) platform.

    Buildkite CEO Keith Pitt said the goal is to reduce the level of friction that exists between providers of third-party package management tools and CI/CD platforms that DevOps teams are today required to address themselves.

    There is no shortage of package management tools used to configure, install and update software, but the level of integration between these tools and CI/CD platforms has not historically been very high. The acquisition of Packagecloud will result in a package manager becoming a first-class citizen within the context of a CI/CD platform, said Pitt.

    Buildkite will maintain the existing support Packagecloud provides for platforms such as Jenkins, but the acquisition will streamline DevOps workflows and improve overall developer productivity, he added.

    In the months ahead, Buildkite will also add a range of tools to better enable DevOps teams to achieve that goal, said Pitt. In addition, the company plans to add tools to streamline the management of compliance processes as regulations pertaining to application development are becoming more stringent, he added.

    It’s not clear how much IT organizations are reevaluating their CI/CD platforms to improve developer productivity, but platform engineering as a methodology to centralize the management of DevOps workflows is gaining traction. Those efforts promise to reduce the total cost of implementing DevOps at scale and improve developer productivity by making the scaffolding required to build applications more readily accessible. Today, too many developers are spending time managing developer environments rather than writing actual code.

    The challenge, of course, is convincing developers—who tend to jealously guard their tool prerogatives—to embrace a platform engineering methodology and cede control over the development environment to a centralized team.

    One way or another, developer productivity needs to improve as more organizations encounter economic headwinds. Developers are the most expensive resource any organization has, so improving the rate at which high-quality code is created will always be imperative, noted Pitt.

    Today, organizations depend on software to drive revenue. Investors are assessing senior leaders within those organizations on their ability to deliver quality software in a timely fashion. Each new application and subsequent software update now has a direct impact on the profitability of the organization. As such, tolerance for legacy approaches to building software that require more time and effort is dropping.

    The issue, as always, is that switching from one software development platform to another is an expensive proposition, so many organizations may find themselves supporting a mix of legacy and modern platforms. The challenge becomes defining the pace at which that migration occurs as new applications are created and legacy applications are continuously updated.

  • Apica Acquires LOGIQ.AI to Unify Observability

    Apica Acquires LOGIQ.AI to Unify Observability

    Apica, a provider of a synthetic monitoring and observability platform, has just raised an additional $10 million in funding and has agreed to acquire LOGIQ.AI. LOGIQ.AI is a provider of a data fabric infused with machine learning algorithms.

    Jason Haworth, chief product officer for Apica, said the data fabric developed by LOGIQ.AI will be incorporated into the Apica Ascent platform in the third quarter. The LOGIQ.AI addition will apply artificial intelligence (AI) in a way that both optimizes and enriches data collected by the company’s observability platform.

    At the core of the Apica Ascent platform is an indexing engine built on top of a Kubernetes platform that aggregates data such as logs, traces and network packets from multiple sources. As part of that process, the platform reduces storage costs by trimming excess data that can be stored in a data lake it provides or a third-party data lake a customer prefers.

    At the same time, Apica also enables DevOps teams to both normalize data collected from multiple sources and enrich it to add additional context, said Haworth.

    The overall goal is to provide a unified view of all IT data to accelerate faster root cause analysis and reduce the total cost of collecting the data required, he added.

    Apica is making a case for an observability platform that goes beyond collecting data from DevOps platforms. As IT environments become more complex, IT teams need to be able to correlate data collected from a wide range of data sources to accurately determine the root cause of an issue, said Haworth.

    The challenge is managing the massive amount of data that needs to be continuously collected, stored and analyzed to achieve that goal, he added. The acquisition of LOGIQ.AI will enable Apica to embed a data fabric that employs machine learning algorithms and other data science techniques to make it feasible to observe complex IT environments at scale, noted Haworth.

    It’s still early days as far as observability is concerned, but it’s clear that IT teams need to move beyond monitoring a pre-determined set of metrics to manage complex and dynamic application environments. The rate of change to application environments as updates are made requires an ability to query data to determine the root cause of issues that could be caused by any number of dependencies.

    The issue is that even when IT teams have access to an observability platform, they may not have the knowledge and expertise required to craft the queries needed to determine the root cause of an issue. Machine learning algorithms will play a major role in enabling IT teams to proactively discover issues that they can investigate using the suggested queries.

    It’s only a matter of time before most IT organizations unify observability data within a single platform. That will make it simpler for them to collaborate across teams and should result in fewer disruptions as IT issues are discovered more quickly. After all, the best kind of IT incident is the one that never happened or that was too trivial for anyone outside of IT to even notice.

  • Palo Alto Networks Buys Cider Security to Lock Down Pipelines

    Palo Alto Networks Buys Cider Security to Lock Down Pipelines

    Palo Alto Networks this week extended its efforts to secure application environments by agreeing to acquire Cider Security, a provider of a platform for securing continuous integration/continuous delivery (CI/CD) platforms, for approximately $195 million in cash.

    The acquisition of Cider Security, scheduled to close this quarter, will extend the reach of the company’s Prisma Cloud platform that was updated last year to include a set of tools for securing infrastructure-as-code (IaC) used to provision IT infrastructure. Palo Alto Networks previously acquired Bridgecrew, which had developed an open source Checkov policy-as-code tool. Last month, Palo Alto Networks added software composition analysis tools to Prisma Cloud, as well.

    Cider Security developed what it described as an operating system for application security. The solution creates a graph that enables DevOps teams to visualize the relationships between all elements that make up a software development environment, including code. It then makes it possible to apply a set of controls to remediate any vulnerabilities and attack paths that might be identified using any number of third-party scanning tools.

    Palo Alto Networks CEO Nikesh Arora told industry analysts the acquisition is an example of the company doubling down on securing software supply chains alongside its existing portfolio of platforms and services for securing production environments.

    It’s not yet clear who is in charge of DevOps platform security, but increasingly there will be some type of central security function that works with application development teams to lock down software supply chains, said Mike Rothman, general manager for Techstrong Research, an arm of the parent company of devopsy.kinsta.cloud. “There’s going to be a central security group focused on securing the pipeline,” he said.

    As Palo Alto Networks continues to extend the reach of Prisma Cloud left, it continues to make a case for centralizing the management of cybersecurity through a portfolio of platforms that can be centrally managed via the cloud. It’s not clear how much organizations are centralizing management of security across their software supply chains and production environments, but Arora noted that interest in consolidating security vendors is high as organizations look to reduce the total cost of cybersecurity.

    In the meantime, organizations of all sizes are looking to employ DevSecOps best practices to better secure software supply chains in the wake of a series of recent high-profile breaches. In addition to scanning code for vulnerabilities, many of those organizations are starting to realize the tools and platforms used to build applications are also vulnerable to cyberattacks. The goal of those attacks is to insert malware that will manifest itself in any number of downstream applications that are eventually deployed in a production environment.

    It’s not yet apparent just how compromised those tools and platforms may be, but it’s clear software consumers are moving toward holding developers more accountable for vulnerabilities. The best-known example of those requirements is an executive order issued by the Biden administration that will require federal agencies to include software bills of materials (SBOMs) that list known vulnerabilities. Many enterprise IT organizations are expected to adopt similar requirements.

    One way or another, however, the tools and platforms that make up a software supply chain, along with the code they produce, are going to be subject to much greater scrutiny than ever before.

  • Old Software Never Dies – But What is it Really Worth?

    Old Software Never Dies – But What is it Really Worth?

    I’ve been thinking about the news from last week that OpenText acquired Micro Focus for what seems to be $6 billion in cash. Mike Vizard did a nice write-up on the news with his take on it here on devopsy.kinsta.cloud (and if you’re interested in the security industry implications, Techstrong Research’s Mike Rothman talked about that, too). While I don’t flat-out disagree with Mike Vizard’s opinions, I do have a slightly different view.

    To me, this is part of a trend we have been seeing from some of the largest tech companies who are sitting on or have access to loads of dry-powder cash. In tougher economic times, cash is king and it is not unusual for the large companies to come in and pick up other companies and lines of business, usually on the cheap. 

    For instance, Broadcom’s acquisition of VMware (though I don’t know that you could call $61 billion cheap). It seems, at first blush, the Micro Focus deal would seem to fit the same kind of bill. I don’t think people believe OpenText overpaid based on these numbers:

    • Total purchase price is 2.2x Micro Focus’ pro forma TTM revenues
    • Total purchase price is 6.3x Micro Focus’ pro forma TTM adjusted EBITDA

    However, I think there’s more here than meets the eye. By OpenText’s CEO’s own admission, it is going to take at least eight quarters (two years) to integrate the Micro Focus portfolio into OpenText’s cloud delivery model.  

    In the meantime, Micro Focus has struggled to maintain profitability and previously announced a $300 million cost-cutting program which will continue with the acquisition. Additionally, the company is saying they will cut another $100 million in costs on top of that; so, a total of $400 million in cuts. 

    Where are the cuts coming from? It’s not like Micro Focus’ broad portfolio of software products are revolutionary new technology—quite the opposite, in fact. Micro Focus, through various acquisitions over the years, has largely scooped up mature product lines from large technology brands that unloaded unwanted or non-strategic software lines-of-business. Of course, the HP/HPE deal was a whole different animal, but the result was not much different. 

    Some mature software came under Micro Focus’ control and Micro Focus has done a decent job of keeping those lines of business turning out what cash they can. They haven’t really “reinvigorated” that software, but have been running out the cycle. Now, OpenText says moving it to their cloud service over the next eight quarters is going to turn things around. I’m skeptical, to say the least.

    I think it will be old software that will be two years older and delivered via the cloud. What must be done goes beyond just putting that software in the cloud—they have to commit to truly relaunching it. Move it to cloud-native architecture; kill some of the older product lines that are near end-of-life and, frankly, which should have been put out to pasture some time ago. Build on the brand equity, sure, but launch some new software.

    At the end of the day, $6 billion is a lot of money—but more money than that has been wasted buying old software in the past. Without a much bolder plan from OpenText, just mumbling about digital transformation and cloud will not be enough to make the Micro Focus portfolio worth anything close to the amount of money they paid for it.

    Like Mike Vizard—and, I am sure, many OpenText investors and Micro Focus users—I will be looking for signs that OpenText are not settling for a lift-and-shift with the old Micro Focus software wrapped in the cloud. It is going to take more than that for this deal to pay dividends. 

    I am not saying it can’t be done. When this deal closes, OpenText will be a software powerhouse with a broad set of customers. Finding new software and services to sell to those customers is the key to this deal.

  • OpenText to Create Software Powerhouse – Acquires Micro Focus for $6B

    OpenText to Create Software Powerhouse – Acquires Micro Focus for $6B

    OpenText this week announced it will acquire Micro Focus for $6 billion. The acquisition is part of an effort to reinvigorate a broad portfolio of information management, application development and testing, integration and cybersecurity platforms by accelerating the rate at which they are transitioned to OpenText’s managed private cloud.

    The acquisition is expected to close in the first quarter of 2023, and the combined company expects to reduce costs by an additional $100 million on top of the $300 million Micro Focus previously committed to cutting as part of an ongoing effort to return to profitability and growth.

    OpenText CEO Mark J. Barrenechea told analysts the ultimate goal is to enable organizations to accelerate their digital business transformation initiatives using a set of application programming interface (API)-centric offerings that reside on a private cloud.

    Digital transformation represents the largest opportunity in the history of computing, he said, but Barrenechea also acknowledged that a lot of companies are still struggling with making that transition. “There has to be a better way to get digital transformation right,” he said.

    The Micro Focus portfolio includes everything from a robotic process automation (RPA) offering, a recently-launched IT service management (ITSM) offering—dubbed Service Automation Management X—along with the Vertica database and LoadRunner testing tools. There is also a slew of cybersecurity platforms that include ArcSight, Fortify, IDOL Zenworks and Sentinel along with legacy COBOL application development tools and even the remnants of Novell.

    In effect, OpenText now has one of the broadest software portfolios in the industry after previously acquiring Documentum, Carbonite, Hummingbird and Zix. “The strategy appears to be to simply gather up all the pieces on the chess board,” said Mitch Ashley, principal analyst for Techstrong Research, an arm of Techstrong Group that is also the parent company of devopsy.kinsta.cloud.

    Despite the disjointed Micro Focus portfolio, OpenText has no intention of selling off any of those offerings, said Barrenechea. Going forward, the strategy is to not only accelerate the transition to the cloud but also expand application license renewal services, he added. OpenText also sees an opportunity to expand the appeal of the Micro Focus portfolio into the small-to-medium business (SMB) market, noted Barrenechea.

    All told, it will take six quarters once the deal is closed to align the Micro Focus business model with the one OpenText currently employs, which Barrenechea said should result in growth starting eight quarters after the deal closes.

    There’s no doubt that, once the deal closes, IT organizations that rely on Micro Focus will be closely watching the level of ongoing investment in the portfolio for any signs of one platform being deemphasized in favor of another. It’s also probable that many customers will be relieved to see the stewardship of those platforms assumed by a company that is on firmer financial footing.

    Regardless of how the OpenText portfolio evolves in 2023, however, one thing that is certain is IT organizations have no shortage of alternatives to consider.

  • Broadcom’s Software Strategy: Milk the Cash Cow, Exploit ‘Synergies’

    Broadcom’s Software Strategy: Milk the Cash Cow, Exploit ‘Synergies’

    The week began with rumors that Broadcom would acquire VMware and ended with the news that the deal is all but done. The VMware board, along with Michael Dell (who still owns about 41% of VMware’s stock), have a 40-day “go-shop” option; however, I don’t believe there will be other suitors.

    On Tuesday, I published an article about Broadcom’s desperation to gain cloud relevance and transform itself into a software company. I detailed the fact that VMware’s profitable business model and its nearly $4 billion of free cash flow makes it an attractive acquisition target. Finally, I said that Broadcom needed to find innovative DNA to make this acquisition work. 

    After thinking further about this proposed acquisition and talking to a number of VMware customers, as well as customers of CA Technology, which was acquired by Broadcom in July 2018, my outlook on the acquisition has become decidedly more cynical and likely more realistic.

    Milk Profits, Minimize Expenses

    We have seen this scenario play out before. Several former CA Technology customers and employees I spoke to was quick to say, “CA—where software goes to die.” That phrase has become so synonymous with CA that even the Wikipedia page for the company has a section on the phrase! Joking aside, most CA customers I spoke with over the last week agreed that since their acquisition, the company has “gone dark.” CA Technologies was a profitable company with important software that enterprise clients relied on and couldn’t easily transition away from. Sound familiar? VMware is in the exact same spot.

    Soon after the CA acquisition, Broadcom slashed about 40% of the CA workforce. On an analyst call to discuss the acquisition, Tom Krause, president, Broadcom Software Group (the Software Group will be renamed VMware) said that the company will increase VMware earnings from $4.7 billion to $8.5 billion within the next three years. How will the company nearly double earnings? “Synergies,” of course. The drivers of growth will be savings generated by eliminating duplicate functions in the combined company along with projections of more workloads running on the VMware platform.

    Do I expect Broadcom to change its corporate DNA to become an innovator? Will VMware innovators change Broadcom? Based on Broadcom’s past behavior, sadly, I think the answer is clear—No.

    I expect VMware to quickly cut costs across the board. Everything from headcount to R&D will see an immediate slash.

    This is Not Dell 2.0 For VMware

    You might argue that VMware has gone through this before when they were acquired by Dell and later set free by Dell Technologies in a 2021 spinoff. Why is this acquisition different? The Dell deal was, at its core, financial maneuvering to finance a deal and enrich investors with the goal of selling or taking the businesses public at a much higher market valuation. There was little cross-pollination between the Dell Technologies companies, and in this deal, Dell acted more like a private equity firm than an acquiring company.

    Broadcom is different. VMware is going to be milked as a cash cow as Broadcom tries to leverage VMware’s importance in the data center. VMware has huge cloud computing customers (AWS, for one) that are reliant on the company’s technology. If you are a VMware customer, get ready for higher prices as the company shifts to more of a subscription model. I also suspect that we will see large layoffs and the diminution of VMware as an entity. This is the end—VMware is not going to have another opportunity to go public on its own or go private in the future.

    I also don’t expect huge technology advancements from VMware over the next decade; but the company won’t die. The company will continue to exist because of the mere fact that enterprise software never dies.

    What Should Partners and Customers Do?

    This isn’t the end of technology acquisitions; nor is it a one-off event. Within the current market conditions, software vendor valuations have come crashing down to a more realistic level. I suspect that many large businesses with cash on hand will be looking to buy profitable software businesses that are viewed as essential. So, what should technology and business leaders do?

    • Understand vendor roadmaps and business. If you choose to go with an independent vendor, especially a smaller company, you need to understand their product roadmap along with their overall business strategy. 
    • Don’t become overly reliant on a single vendor. This isn’t the first time VMware has forced customers to rethink their relationship with the company. Years ago, VMware attempted to drastically increase licensing costs. Customers revolted and the company reversed course; however, it was a wake-up call and many businesses began to look at alternatives like OpenStack. You also need to ask technology leaders within your business what happens if a vendor changes their pricing, becomes a competitor or goes out of business. These “what if” scenarios are critical to reducing your risk.
    • Explore open source options. Open source isn’t a cure-all, but many businesses have adopted open source in part to reduce the risk of vendors changing strategies, increasing prices or no longer supporting your software. With open source technology, even if a project’s community is no longer active, a business that uses the technology can continue to contribute code and maintain the project.