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Tuesday, May 10, 2005

I.B.M. Glues Gluecode – A Defensive Move?

(Via NYTimes)IBM seems to increasingly bet that it can build a big business around open-source. software. The latest step in that strategy is the purchase of Gluecode Software, an open-source start-up. The Gluecode acquisition, is small in size but significant in the evolution of the company's plans in open-source software. I.B.M. has long supported open-source software like the Linux operating system and the Apache Web server. And it has made money indirectly, mostly by selling computers that run open-source software or selling I.B.M. proprietary software that works with Linux or Apache. But Gluecode is a stand-alone open-source business, and the purchase will give I.B.M. a stake in the lower-end market for server software for running business applications.
Gluecode sells support and service for an open-source server, called Geronimo, used by companies for applications including customer service, electronic commerce Web sites and work-sharing Web sites. I.B.M. offers its own proprietary server, WebSphere, for business applications. It does not see Gluecode and Geronimo as potential competition in that area, but rather as a way to enter new markets."This widens our market," said Steven Mills, the senior vice president for software. "Some customers may later move up to WebSphere if they choose to go in that direction. But if they don't, they don't. This is its own business."The Gluecode acquisition can also be seen as a defensive tactic for I.B.M, which ran the risk of ceding the lower end of the business application server market to others, like JBoss, another open-source start-up, which has grown rapidly recently.

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