My old associates at the 451 Group put together a great report about open source M&A (ironically released a day before the Sun/MySQL deal was announced). For non-451 clients a great summary is on the group’s open source blog.
The report posits the following reasons for open source M&A:
- Entrance into new markets
- Portfolio expansion
- Consolidation play
- Business overhaul
- Technology play
- Project acquisition
- Technology transfer
- Carve out
I think the fourth point is most important. While “business overhaul” may be a bit hyperbolic, nearly every software company must be considering some sort of open source move if they want to survive. Open source is no longer a marginally developing trend, as we know. Rather it is going to be part of commercial technology’s DNA for the foreseeable future.
So, while I like the report, I think almost all of the acquisition drivers fall under the overarching category of Business Overhaul. There are a lot of closed source companies out there that desperately need to open up. And even if the project they acquire never gains them commercial success, the lessons learned from managing and adopting a community could pay dividends down the road. Just as we saw a lot of CRM vendors acquire SaaS vendors for the infrastructure smarts and not the product itself, we should continue to see more M&A deals in open source that teach the acquirer about thinking in an open source fashion.