IBM just bought Red Hat $34 billion, which is why members of the opensource community are currently flailing around like headless chickens. $34 billion, that is 5 Githubs, 1 Instagram + 1 WhatsApp or 34 Minecraft. Two things might be crossing your mind:
1. « They can buy ME for $34 billion!! »
2. « What does that actually mean for the opensource and libre communities? »
I’ll try my best to answer the latter.
What’s going on
What’s Red Hat again?
Red Hat is an American multinational company, the biggest around dedicated to FOSS software. How big? « On the stock market » big, netting billions in revenue and counting 12,212 employees. They create, maintain and support a lot of free software projects (the Gnome Project for instance), and are one of the largest contributors to the Linux kernel.
What do they sell if they make free software?
Mostly, they sell support and maintenance contracts to businesses that use their free, enterprise-class operating system Red Hat Enterprise Linux or the wide range of FOSS applications to which they are main contributors. This includes Fedora, CentOS, CoreOS, JBoss middlewares, WildFly, Open Shift, Project Atomic, Open Stack… Their operations range from developing containerisation and virtualisation software to maintaining full Linux distributions.
What is IBM doing these days anyway?
While « Big Blue » has arguably been declining, it remains a big player selling mainframes and legacy software to industries that are heavily dependent on IBM solutions, in the financial sector for instance. Though criticised and definitely dated, they are very much not dead considering they filed more patents than anyone (even Google) the past 25 years. They usually think on the long term, which is why they are heavily investing in AI, cloud, quantum computing or blockchain projects. Red Hat is a big name of the distributed systems industry, and acquiring it could cement IBM’s position on this market, against Amazon or Google.
There are reasons to be wary
Yet, people are screaming bloody murder and already lighting candles for Red Hat employees. That’s because IBM has a history of causing disasters buying out perfectly good companies and crushing them under its corporate heel. I once read this strategy dubbed « corporate colonialism ». Trusteer, Brief, Codewright, Rational, Telelogic, Lotus, Tivoli, Algorithmics,… So many companies were acquired by IBM only to suffer transformations, cuts and strategic changes to the point that promising products turned into terrible, antiquated garbage. They do what Electronic Arts does in the video game industry. One must admit that with so many acquisitions (seriously, look at that Wikipedia article), some of those are bound to disappoint, but the fact is IBM is not a proponent of the « light touch » approach and usually imposes its ways to the acquired business, sometimes running it to the ground in the process. Accounts from former employees reveal how awful IBM’s HR practices can be in these situations, sometimes making employees reapply for their own job through a third party staffing agency, or re-hiring them as contractors.
Sure, this is no news in the tech industry, Oracle, Cisco, Microsoft or Apple do the same. IBM just does it worse, more frequently, and combined with its reputation of offshoring everything to reduce costs with no concern for quality, one can legitimately be anxious for Red Hat. This process of outsourcing every hands-on job to IBM divisions in China, India or Brazil was even given its own name: the infamous « Blue Washing ». It also reflects the IBM corporate culture which is undoubtedly very different from Red Hat’s, less toxic and imbued with the FOSS philosophy (upstream first). FOSS projects like CentOS or Fedora are used widely and well-loved, and this could fast-track their deprecation.
In addition, concentration is never a good thing, and the open source world is getting smaller. What’s next? Microsoft buying Canonical (Ubuntu)?
But let’s not get over our heads
On the other hand, this move could buy Red Hat some additional street cred in enterprise and government circles, for instance in pro-Microsoft corporations. Let’s dispel this idealistic vision that is currently trending: Red Hat is a for-profit with a board of directors that very much wants money. Besides, IBM have supported Linux since the early days, and actively contributes to FOSS projects. Hell, some of their processors’ firmware are libre (Power9)! IBM might be declining since the golden years, but remains huge due to big corporations and government contracts, expertise in storage technology and strategic positioning in state-of-the-art endeavours. You might have heard of Watson?
We hear everything about IBM, positive and negative, and it is far too early to put Red Hat in the grave. Let’s install Debian or Suse and watch what happens.