International Business Machines Corp. (NYSE:IBM) announced that it is acquiring NoSQL vendor Cloudant on the same day that Oracle said it will buy BlueKai, which runs a data management platform popular with Big Data marketing companies. While the two acquired companies don’t directly compete with each other (and neither company revealed exact terms), the purchases show that competition in Big Data is starting to heat up.
“Joining IBM allows Cloudant to innovate faster than ever before, and International Business Machines Corp. (NYSE:IBM)’s track record in open source software gives us complete confidence in our ongoing collaboration with the Apache CouchDB project. Cloudant could not have found a better home than IBM,” said Cloudant CTO and Co-Founder Adam Kocoloski reports Andrew Brust for ZDNet.
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IBM’s deal follows $1.2 billion cloud investment
Cloudant is a Database-as-a-service (DBAAS) company that runs on IBM Softlayer and will become part of International Business Machines Corp. (NYSE:IBM)’s Information and Analytics group. Brust, who has been watching the sector for some time, has been expecting a wave of M&A activity to consolidate Big Data, and now rival NoSQL vendors MongoDB and Couchbase have to choose between making their own deals or going head to head with IBM and potentially being outspent at every turn.
International Business Machines Corp. (NYSE:IBM)recently announced that it was investing $1.2 billion to develop its cloud offerings, including the construction of 15 new data centers with plans to have facilities in every region of the world and every financial center by the end of next year so that it can offer extremely low latency to enterprise clients. Even if Big Data startups have better ideas and great teams, it will be hard to compete with IBM’s looking infrastructure advantage on their own.
2013 could have a surge in Big Data M&A
Oracle Corporation (NYSE:ORCL)’s acquisition of BlueKai is less surprising since Oracle has already bought Responsys Inc (NASDAQ:MKTG) and Eloqua Inc (NASDAQ:ELOQ), all three of which will be combined into a single division. BlueKai helps companies take data that they have already collected and mine it for personalized, targeting marketing campaigns.
“BlueKai will be integrated with both Responsys for B2C marketing automation and Eloqua for B2B marketing automation in order to deliver orchestrated and personalized customer interactions across all marketing activities and channels,” wrote Oracle executive VP of applications Steve Miranda, reports Larry Dignan for ZDNet.
Microsoft Corporation (NASDAQ:MSFT), SAP, and other megavendors have also been moving into Big Data and cloud computing recently, and while some smaller companies may decide to stand on their own, the sector looks primed for a surge in M&A activity.