Acquisition of the Week update from May 2005

Today IBM acquired Gluecode, an Open Source Solution vendor who built applications on top of the Apache/Geronimo stack. Long a supporter of open source in general, IBM has now stepped firmly into support of the OSS business model, which gives away software for free and turns a profit on support and professional services specific to the developed software. Gluecode offers a wide variety of J2EE based open source applications, including a portal and BPM (Business Process Management) software. The applications have been and will continue to be available for free download - including Gluecode's competing J2EE application server - with Gluecode's support and professional services being managed out of IBM's software division.

Another interesting piece of Gluecode's OSS offering is its Managed Open Source model, which is similar in nature to the Red Hat network in its ability to push updates of software to customers. Whether this offering will make its way into IBM proper and become an option for IBM's rather large customer base of WebSphere family products, IBM could not say.

What IBM could, and did, say is that there is a growing demand for the OSS Application Server model and that it sees value in the model as more of the SMB market is demanding freely available application server offerings that ride on top of the Apache Software Foundation's Apache/Geronimo stack. IBM indicated that while Gluecode applications would eventually be rolled into the WebSphere family and rebranded they would continue to exist as OSS.This was an excellent move for IBM, as it extends its reach into the SMB market and allows Big Blue to grab hold of a piece of the pie that is the OSS business model. It has been difficult in the past for IBM to gain a foothold in the SMB market due to the relatively higher cost of WebSphere Application Server when compared to competitors. Even though IBM moved to tiered offerings, with an Express Edition of WebSphere affordable to just about any size organization, Gluecode's offering gives IBM a free entry point into smaller organizations and an eventual upgrade path into its WebSphere product line. It is also another validation of the OSS business model, which can only be good news for up and coming application vendors who've chosen to follow the OSS path.