Who Will Buy Canonical and SUSE?

https://www.patreon.com/posts/who-will-buy-and-31572837

by mikece • 7 years ago

57 41 7 years ago

rglullis• 7 years ago

Stranger things have happened, but https://bugs.launchpad.net/ubuntu/+bug/1 makes me believe there is ~somewhat~ of a conflict between Canonical and Microsoft.

jasonjayr• 7 years ago

If the acquisition goes through they can just close that as WONTFIX.

cbmuser2• 7 years ago

It might be changed to "IN_PROGRESS" with Microsoft Edge being released for Linux next year :).

basch• 7 years ago

it was already closed in the wake of rising ios and android marketshare. linux/unix devices have measurable consumer marketshare they didnt 20 years ago.

coldtea• 7 years ago

Well, if they're bought, then that will have to change designation as a "feature".

Santosh83• 7 years ago

Bad trend for user freedom when the industry keeps acquiring and consolidating and further fattening the already fat giants.

rwmj2• 7 years ago

Not really. The barrier to entry in Linux distributions is pretty low. Everything that Red Hat does is open source so can be forked.

tw04• 7 years ago

Forking Red Hat doesn't get you ANYWHERE close to having a replacment. What Red Hat got right was all the enterprise support contracts they were able to negotiate. You want to buy adapter X? Well if you have an issue with it, you need to reproduce it on Red Hat because the guys at Company X can work with the guys at Red Hat on a bugfix. Company X isn't really interested in having their highly paid developers sitting on mailing lists trying to negotiate a patch for the issue.

The source code is the easy part.

a3n• 7 years ago

It's the same for the internet in general, which has been turned into TV, and whose main purpose is to serve ads.

coleifer• 7 years ago

It's worse: it's reality TV.

pjmlp3• 7 years ago

I pretty much see that happening

I will be gone by then, however in a couple of decades anything substantial based on GPL will be gone, and it will business as usual regarding UNIX wars.

frou_dh• 7 years ago

You can never leave the industry. Who else will post the daily reminders that AOT compilers exist for Java?

pjmlp3• 7 years ago

Someone else. :)

bonsai80• 7 years ago

Canonical is working towards an IPO.... so I will! :)

ianai2• 7 years ago

Wow, I wonder how far away that is. I also hope they get enough money to make some strong market share with new products.

jasoneckert• 7 years ago

I actually made the same gut speculations in common conversation earlier when IBM bought Red Hat (SAP buying SuSE, Microsoft buying Canonical). It was nice to see this post that flushed out the rationale in more detail.

ianai2• 7 years ago

There will be several bidders, I expect. IBM would have a reason to buy SuSE as would Microsoft. Nothing grows your market power by buying a competitor - no matter how small or technologically different.

curt15• 7 years ago

Canonical is already moving to a Microsoft-style update model for some of its software. https://forum.snapcraft.io/t/disabling-automatic-refresh-for...

dorfsmay3• 7 years ago

For a desktop on the other hand, this is great.

People are used to having their phone constantly upgrading automatically, which make it hard to explain to non-technical users why they need to `apt upgrade` regularly.

mikece• 7 years ago

“Canonical has, historically, had a number of products (and attempted product initiatives) that didn't quite work out (including Ubuntu Phone, Ubuntu for Android, Ubuntu for TV, and several software initiatives)...”

Anyone else reminded of Microsoft when you read that? Windows Phone, Zune, MSN TV, and “several other software initiatives” (Bing, Bob, Clippy, etc)...

pjmlp3• 7 years ago

Actually I was thinking about Google's products

Avamander• 7 years ago

I think Ubuntu for Phone was just too soon, had they taken it slower the project would have probably been ready now and usable on phones such as the PinePhone and similar.

johnchristopher• 7 years ago

Not really.

None of Canonical products reached the general consumer market in any significant ways while the Windows Phone and the Zune have good reputation (and have been actually sold to consumers). I hear Bing is doing okay and Clippy is from a different millennium.

Surface, Xbox and azure are doing great.

digi594044• 7 years ago

Microsoft won’t buy Canonical. Folks are making these predictions without a root cause analysis as to what the companies do well. IBM bought Red Hat because IBM bet wrong in the cloud race and is/was way behind. Red Hat consolidated companies beneath them and worked hard to expand their cloud offerings. Right now on OpenShift along the US Gov pays them $100MM a year. Just OpenShift.

Add to this banks, grocery stores, and airlines are moving off mainframes and to the cloud - and choosing OpenShift. IBM was starting to get eaten by Red Hat. Not to mention IBM is on the cusp of a major leadership change, and needs fresh cloud leaders to lead IBM into the next decades.

These are the reasons IBM bought Red Hat. Because IBM has lost its way. Red Hat had the most to offer.

Canonical doesn’t have much to offer. Few people are paying for Ubuntu. Yeah yeah it’s popular in Docker images, yeah yeah it’s a popular desktop distro. But so what? OpenStack is shrinking (SUSE abandoned it for Kubernetes) and Ubuntu has bet their farm on OpenStack. They don’t have much in the way of Kubernetes. On OpenStack Red Hat has most of the customers. Canonical has almost nothing to offer in terms of being bought out. They have very few items that produce profit. They made a huge (and flawed) bet on mobile and failed. Ubuntu doesn’t have strong leadership and doesn’t have strong clients - In fact I’ve been a consultant for 5 years now bouncing between companies every few weeks. I have YET to run into a Canonical client.

This is why no one will buy Canonical. SUSE? Well we’ll see.

cbmuser2• 7 years ago

IBM still earns a lot of money with their mainframe and AIX business.

digi594044• 7 years ago

Yes, But shrinking. The concern is not necessarily now - But in a decade.

dorfsmay3• 7 years ago

"Few people are paying for Ubuntu"

I have never understood their paid support tier pricing model. They should have offered a low cost email only support, say with a 24 or 48 hour turn around policy and could have gain many enthusiasts and small companies some of which would have transfered to bigger contract.

ThrowawayR2• 7 years ago

Reportedly MS did consider buying Red Hat but backed out because of anti-trust concerns.

"Microsoft, which, according to one source, is referenced throughout the proxy statement as 'Party A,' first expressed interest in Red Hat back in March. But Microsoft dropped out of the running on October 10, according to the proxy, 'citing concerns about securing regulatory approvals of a strategic transaction in the US and Europe.'"

Google was also considering it

"Google, which one source said was 'Party B,' met with Red Hat in the spring of 2018 to discuss partnerships. As a deal with IBM got closer, Google continued to move forward with the sale process, but stopped short of making an offer. Though Google's former Cloud CEO Diane Greene spent a lot of time with Red Hat ahead of its sale, she struggled to get support from the company on her large mergers-and-acquisitions aspirations, according to one source. So on October 20, Google officially declined to submit a proposal and instead asked if Red Hat would explore a commercial partnership and a minority equity investment from Google."

Block javascript if you want to read the article:

https://www.businessinsider.com/red-hat-deal-talks-with-amaz...

digi594044• 7 years ago

Yeah I was in RH during this and saw a lot of the internal talks. Red Hat had a reason to be bought.

Canonical... Doesn't.

ofrzeta• 7 years ago

Canonical doesn’t have much to offer

The actually have a lot of stuff: LXC/LXD, MaaS, Juju/Charms and MicroK8S. These are all solutions to real problems but maybe they are lacking marketing because they are not well known.

digi594044• 7 years ago

No one is paying for those. LXC/LXD has plenty of other groups to pay. MaaS, the same. Juju/Charms are not a widespread solution, and MicroK8S is way too late.

Ubuntu as a whole has nothing people want to pay for.

chr15p• 7 years ago

IBM was profitable but stagnating, they were already a major reseller of Red Hat, who were growing rapidly, had good tech, lots of potential to grow more, and was already big enough that they may be able to change IBMs numbers by enough to not just get lost in the noise (if you make $8.5+ billion profit changing that by $100million isn't going to get wall street excited)

Someone like MS would buy Canonical for completely different reasons, they're not big enough to effect Microsofts profits in any way, they dont have any really interesting tech, but they do have the Ubuntu brand and control of one of the really big linux distros (the biggest on the desktop) so there might be value in Azure being able to brand itself as the home of Ubuntu ("it runs perfectly on our cloud becuase we write it that way"). To be honest though I dont see that as a big enough thing to make MS risk their reputation as a good place to run Red Hat and openshift. The only other reason to buy Ubuntu would be to kill it, and the political ramifications of that to the open source friendly reputation they've worked hard to build would be bad.

ausjke• 7 years ago

Anyone but Microsoft please. I can never trust Microsoft for the rest of my life. If that occurs I will use Debian 100%.

On Canonical side, I read somewhere complaining they suck at marketing, they could have done much better otherwise.

chirau• 7 years ago

Never is a strong word

itomato• 7 years ago

I prefer to look at the other side.

Why the focus on acquisition with vague synergy? HANA drives SUSE adoption, but the Linux piece is relatively static compared to the tooling required to scale and manage these big stacks?

I like to think HashiCorp or another software vendor sees the appeal of building their components into a sturdy Linux product like SUSE.

I might have speculated the same about Docker or Ansible, but they have already been similarly absorbed.

Rather than the consolidation in favor of existing and entrenched tech like SAP, it's inspiring to think a new IBM or Microsoft is being built and could benefit from a Telco-grade OS.

nieve• 7 years ago

I may be misunderstanding you, but I find it difficult to believe Hashicorp could put together a big enough set of investors to drop a couple of billion on SUSE. You occasionally see smaller companies buy bigger, more established ones with higher revenues and such, but it's pretty rare.

mongol• 7 years ago

We can see governments in Europe making moves to encourage European vendors to build clouds that are unreachable by US legislation. i think SUSE can come into play here, one way or another. I think EQT will try to position SUSE in this area.

dorfsmay3• 7 years ago

OVH?

sam_lowry_• 7 years ago

Rimes with crap and gamers and filesharing.

Who Will Buy Canonical and SUSE?

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