IBM Buys The Leader In Linux. Will Putting On A Red Hat Save Big Blue?

The $34 billion deal is the third-largest tech deal in history, and a must-win for IBM.

By Shelly BrisbinNovember 1, 2018 1:45 pm,

When you think about tech company buyouts, it’s usually new-tech giants like Amazon and Google that come to mind. But this week, IBM announced the third-largest tech merger ever. IBM, a company that’s been in business more than 100 years – with 10,000 employees in Texas alone, and a major research lab here, too – announced it will buy Red Hat, the leading maker of Linux software, for $34 billion. Lots of people are saying this could be IBM’s last and best chance to remain a player in the tech world.

Our tech guru, Omar Gallaga, is here to help us make sense of Big Blue’s purchase of Red Hat. He says Linux, the software Red Hat sells, is an open-source operating system; like Windows or macOS, Linux is the software that runs a computer. And while other companies sell versions of Linux, Red Hat is the biggest. Linux is most often used by businesses; it runs servers, cloud-computing platforms and more.

“It definitely feels like a Hail Mary. It feels like a big play,” Gallaga says. “The thing is, the deal will not even go through until probably the end of next year.”

What you’ll hear in this segment:

– Why IBM wants to acquire Red Hat

– Who IBM’s competitors are and how Red Hat will help them compete

– How IBM’s business has changed over the years

Written by Shelly Brisbin.