Another Cloud Integration Company Bought by Big Vendor

Loraine Lawson

When Michael Dell teased that Dell planned to announce a cloud acquisition today, it was assumed he meant something along the lines of networking capabilities. Wall Street theorized it would be Brocade, which specializes in data center networking, or Rackspace, which offers cloud-based servers and managed Web hosting.

 

After all, these companies fit in with Dell's other 2010 acquisitions: Ocarina Networks, a deduplication and backup company, and Exanet, which provides network-attached storage software to OEM partners. Dell also bid against HP for 3Par, a storage company.

 

Nobody guessed Dell would avoid the obvious network companies and head for the middleware by acquiring in Boomi, a company that's distinguished as one of the few pure-play integration-as-a-service cloud providers.

 

I have to wonder if Wall Street has even heard of Boomi. TechCrunch reports it has raised "only $4 million" in venture capital funds, and eWEEK reports that while rumors of the Rackspace acquisition gave that company's stock price a 6 percent boost, Dell's stock remained flat after the Boomi announcement.

 

To be fair, Boomi does play in an unusual, niche integration space: Boomi offers a cloud-based service called AtomSphere, which is an integration platform for connecting cloud-based applications (aka services) with other, mostly on-site applications. It's truly integration via the cloud, and primarily it sells the service to cloud providers, who then package it with their own services applications.


 

Boomi is one of the few players with a head start on what Gartner's Daryl Plummer calls the "cloud service brokerage," a new market Plummer believes will grow as more organizations move online.

 

Pre-packaged integration appeals to cloud companies because it removes one big barrier for customers who want to use cloud services, but are concerned about integration with on-premise applications.

 

Since last year's acquisition of Perot Systems, Dell has made no bones about its plans to break out of its hardware, PC roots and head for the enterprise stack, and this is certainly a strong move in that direction. ReadWriteCloud summarized the impact nicely:

Boomi has made a name for itself in that sweet spot where cloud computing meets the enterprise. It's a fitting acquisition for Dell. It provides the company with a way to go deeper into the enterprise stack and be the company that provides the systems for integrating with the cloud. And why is this important? The network is increasingly porous. The data center is networking with the cloud. At this point, it's a race to control how that transition happens. It's where we see almost all of the large vendors establishing a foothold.

So, obviously, it's a smart move for Dell, which has not shared any details of the planned acquisition.

 

But my question is: What does this mean for the cloud integration space, in particular the companies looking for solutions for integrating with the cloud? After all, this is not the first such acquisition: IBM recently acquired Cast Iron, which provided several ways of integrating between the cloud and on-premise.

 

Ray Wang, an analyst with the Altimeter Group, says this may be a sign of more cloud integration acquisitions to come.

Integration vendors who can connect cloud to on-premises are a key component in any vendor's strategy to master the cloud.

So far, there's no word from Boomi about the deal, but that's not unusual in these situations. When Cast Iron was acquired by IBM earlier this year, Boomi's CEO, Bob Moul, did issue a statement that sounds a bit ironic now:

Boomi ... has been focused exclusively on the cloud computing space and has built the industry's number-one integration cloud as pure software-as-a-service. We remain committed to the cloud and are convinced that this pure SaaS integration approach is the best model to drive the continued success and expansion of the cloud computing industry.


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