Dell and Oracle Acquisitions

Dell Inc. and Oracle Corp. both announced two acquisitions last week. Dell is acquiring the assets of Exanet Ltd., a storage company, and KACE Networks Inc., a provider of systems management appliances. Meanwhile, Oracle continued its acquisition streak by announcing its acquisition of SOA governance provider AmberPoint Inc. and Convergin Inc., a provider of real-time service brokering solutions.   

 

Focal Points:

• Dell claims it is in the process of acquiring the assets of Exanet, an Israeli storage company for a consideration of $12 million. The final settlement is yet to be completed. Just last month the company went into receivership when it unable to pay off its debt of $70 million and defaulted on the same. Dell is negotiating in an Israeli court to acquire all of Exanet’s intellectual property. The purchase will give Dell its first R&D center in Israel and add Exanet's clustered storage solution to its product line.
• Dell announced it has agreed to acquire KACE, a leading systems management appliance company with solutions tailored to the requirements of midsized businesses and public (government, education and healthcare) institutions. KACE is headquartered in Mountain View, CA and employs a 125-person workforce that will be absorbed into Dell. The financial details of the transaction were not disclosed. KACE's flagship product is the Kbox line of appliances, which is targeted at IT shops that have a large number of systems to babysit but cannot afford a systems administrator or software-based server management. An entry level Kbox appliance is priced at around $5,000. The acquisition will supplement Dell's Perot Systems service management business.
• Oracle stated it agreed to acquire privately-held AmberPoint, a SOA Management provider. Financial details of the transaction were not disclosed. AmberPoint is based in Oakland, CA.; its employees are expected to join Oracle. AmberPoint's SOA Management, Application Discovery, Business Transaction Management and run-time SOA Governance products are expected to augment Oracle Fusion Middleware SOA Suite and Oracle Enterprise Manager. 
• Oracle has agreed to acquire the Israeli-based software firm, Convergin, for an undisclosed amount. Convergin will broaden Oracle's presence in the telecom market, as it develops J2EE-based Service Broker and Service Capability Interaction Management (SCIM) offerings for both wireless and wireline network carriers.  The deal extends Oracle's service delivery capabilities and enables the company to offer a comprehensive portfolio of network-centric pre-paid and value added services for the communications industry.

 

Experton Group believes companies of all sizes are looking for vendors that can offer comprehensive suites and services, not just point solutions. This shift, which has been occurring over the past few years, put Dell at a disadvantage. Hence, Dell is filling out its portfolio of storage and management products and services so that it can better compete in the commercial markets. Oracle, on the other hand, continues to drive its strategy to be a one-stop shop for all commercial enterprises.  IT executives should recognize that integration of acquired offerings with the provider's other platforms can be a major challenge and take a vendor a number of years to achieve. It can also slow the implementation of customer requirements into the package and potentially impact functionality improvements. Therefore, IT executives should understand the vendor's roadmap and strategy and ensure these conform to the enterprises' needs.