UPDATED 09:59 EDT / SEPTEMBER 27 2010

IBM Acquires Blade Networks, Bulking Up Without Making Enemies

IBM has made another storage acquisition, taking on BLADE for an undisclosed amount, though Barrons puts the estimate at $400 million. The blade server company has been a long-time partner of IBM, working together to develop products for IBM System x BladeCenters and other products.

Based in Santa Clara, CA, Blade Network’s investors including Juniper Networks and Garnett & Helfrich Capital. As part of IBM’s efforts to bulk its data-center offerings, the company’s been making a number of strategic acquisitions. Besides Blade, this month’s purchases also include OpenPages and Netezza. It’s the partnerships, however, that make lasting impressions. Juniper sees the bright side of this new alliance, telling us that “this deal is beneficial for Juniper. As an investor in BLADE Network Technologies and a strategic alliance partner with IBM, this will enable us to collaborate more closely when our products and services are deployed together. All three companies are aligned in our commitment to addressing customers’ most challenging connectivity needs for next-generation data center networks.”

The Blade acquisition is important for IBM’s smart grid offerings, as demand in this area is expected to continue in growth. IBM has also unveiled a number of new products this year, in an effort to keep pace with competitors such as Oracle, which launched its own blade servers on the market last year.

The lower interest in blade servers kept Blade Networks relatively small until recently; an early point made by Wikibon analyst Stu Miniman, “One of the first places where 10GbE has seen some significant volume is blade servers, and an early winner in that space is Blade Network Technologies (BNT). BNT specializes in networking embedded solutions including OEM offerings with HP and IBM.”

Oracle is becoming a pesky component in many regards, as the company demonstrated last week at its OpenWorld conference. There, Oracle revealed a number of products and partnerships, standing staunchly on the wide-set network of services its been developing (in-house and through acquisitions) over the past couple of years.

The quickening acquisitions and tidal wave of product releases is sending lots of attention to the cloud, and the market is responding as such. Miniman comments on today’s cloud scene, noting that “there is a lot of consolidation happening in the industry as companies are looking to build their own stacks.

“While HP is looking to take on Cisco in the networking space, IBM took a prudent move by bolstering their solution without alienating any of their partners. While there were rumors about IBM buying Brocade, the BNT acquisition is a much more natural fit. IBM was already OEMing BNT technology; now together they can help shape the next generation of high-performance integrated solutions.”


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