What Cast Iron Brings to IBM's Cloud Story

Those in the know weren't surprised to hear IBM had acquired integration vendor Cast Iron.

I, of course, was shocked. I don't have a good reason to be shocked. I guess my surprise stems from the fact I'd just interviewed Chandar Pattabhiram, vice president of Channel and Product Marketing for Cast Iron, last month about the company's recent release of OmniConnect, a new cloud integration platform. And this is the second or third time I've interviewed a company only to learn weeks later that they've been bought out by a bigger vendor.

It's making me a little paranoid, to be honest with you.

The Twitter buzz on the deal seems to be generally positive. Analyst Judith Hurwitz heard the news at this week's IBM Impact, which can be viewed via LiveStream, and declared it a "Good choice!"

"IBM buys Cast Iron Systems for cloud integration - a no-brainer," wrote Neil Ward-Dutton, the research director at MWD Advisors.

Why would IBM want Cast Iron? Here are seven reasons:

1. A solution to one of the more frustrating problems of moving to the cloud: Integrating on-premise applications with cloud solutions. An example: Cast Iron can integrate Salesforce.com with SAP on-premise.
2. What's more, it solves the cloud integration puzzle in several different formats, or "a variety of integration styles," to quote Dana Gardner. OmniConnect can be used as an appliance, which can be secured on-premise, as a virtual appliance or as a subscription-based cloud service Pattabhiram explained to me recently.
   
3. It's simple. Both Red Monk analyst James Governor and Ward-Dutton commented on its easy-to-use, drag-and-drop integration software.
4. It can also be embedded in other applications, a feature that appeals to SaaS companies that want the ability to brand and package integration with their solutions. That alone might make this an appealing deal to IBM's clients.
5. An established community of cloud-based integration partners, including Salesforce.com (of course), Microsoft, Google, ADP, Netsuite, Enomaly, and so on, as Ward-Dutton writes in his blog on the Cast Iron acquisition.
6. A "SaaS-aligned" pay-as-you-go licensing and pricing model, Ward-Dutton says. Given that IBM expects the cloud computing market to reach $126 billion by 2012, that's no small thing.
7. And, of course, Cast Iron brings its existing customers, whom IBM says it will continue to support. According to Ward-Dutton, Cast Iron has "a significant base of mid-sized customers."

As for what Cast Iron gets out of the deal - well, that's anybody's guess. The details of the acquisition aren't being disclosed. IBM has said it will add the 75 Cast Iron employees to its own payroll.

One veteran IT analyst and writer did have a theory, however. Curt Monash believes Cast Iron needed to be rescued. He even titled his blog post, "IBM puts Cast Iron Systems out of its misery." That said, he didn't offer any specific evidence to support this claim, other than writing, "...Cast Iron has been pretty hard to get a hold of, and I also couldn't find anybody (competitor, friend of management, whatever) who believed Cast Iron was doing particularly well."