IBM Holds a Candle

IBM Corp.s (NYSE: IBM) acquisition of data center software specialist Candle Corp. is set to extend the hardware giant’s reach in the area of on-demand computing.

Earlier today IBM announced that it had agreed to acquire the El-Segundo, Calif., firm. Although the financial details are yet to be disclosed, one thing is clear -- the deal reflects IBM’s obsession with managing on-demand environments.

Perhaps the only surprise is that it has taken the two companies so long to tie the knot. After all, Candle has been an IBM Business Partner since it was founded in 1976. Joe McKendrick, analyst at research firm Evans Data Corp., says, “It seems like such a natural union -- the couple have cohabited for years, and now they have decided to get married.”

But, on a more serious note, analysts have identified the deal as a shrewd move on IBM’s part.

“Candle’s product lines are performance and monitoring tools," McKendrick notes. "One of the things that they have been working on is extending these products across different vendors’ environments. If IBM is to offer this on-demand environment, where the platform or vendor is a secondary consideration, Candle can offer some of that cross-platform capability."Certainly, Candle’s infrastructure management products cover a wide range of hardware and software, from IBM’s zSeries mainframe to the Unix, Linux, and Windows platforms.

Dana Gardner, senior analyst at Boston-based Yankee Groupagrees with McKendrick’s take, saying, “This increases IBM’s integration capabilities.”

Software that is capable of managing processes and systems is hot at the moment, according to Gardner. “I would expect that some acquisitions in the management category could be in the offing from companies like Sun and SAP.”

In a statement today, Steve Mills, senior vice president and group executive of IBM’s software group, underlined Candle’s importance to IBM: “Together we will provide customers with powerful capabilities for managing end-to-end infrastructure, processes, and applications, which are key requirements for the on-demand operating environment.”

Who said that romance is dead?James Rogers, Site Editor, Next-gen Data Center Forum