Turbotodd

Ruminations on IT, the digital media, and some golf thrown in for good measure.

IBM To Acquire Netezza

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IBM and Netezza today announced they have entered into a definitive agreement for IBM to acquire Netezza, a publicly held company based in Marlborough, Massachusetts, in a cash transaction at a price of $27 per share (or approximately $1.7B).

Netezza will expand IBM’s business analytics initiatives to help clients gain faster insights into their business information.

The acquisition, which is subject to Netezza shareholder approval, applicable regulatory clearances and other customary closing conditions, is expected to close in the fourth quarter of 2010.

The rate and pace of data is accelerating the IT opportunity around information and analytics.  A recent Global IBM Study revealed that 83 percent of CIO’s identified analytics as a top priority.

The combined strengths of IBM and Netezza are a key differentiator at a time when organizations of all sizes are looking to gain more insight from their business information. Netezza is a leading provider of high-performance analytics in a data warehousing appliance that can be up and running in a matter of hours, handling complex analytic queries 10 to 100 times faster than traditional systems.

The simplicity, speed and ease of deploying Netezza appliances brings analytics directly into the hands of business users within every department of an organization such as sales, marketing, product development and human resources.

The existing relationship between IBM and Netezza reinforces the combined value to clients.  Today, Netezza designs and develops its appliances on IBM systems technology and combined with IBM software powers many applications within organizations.

The two companies have been strategic partners for many years focused on workload optimized systems that deliver integrated systems, software and storage for analyzing vast amounts of complex data.

“IBM is bringing analytics to the masses.  We continue to evolve our capabilities for systems integration, bringing together optimized hardware and software, in response to increasing demand for technology that delivers true business value.  Netezza is a perfect example of this approach,” said Steve Mills, senior vice president and group executive, IBM Software and Systems.  “Netezza strongly complements our business analytics capabilities and client base.  Together, we have the opportunity to quickly leverage the technology and accelerate the offering.”

Today, more than 350 clients across a variety of industries have adopted Netezza.  These companies include eHarmony, Neiman Marcus, Time Warner, Estee Lauder, Blue Cross Blue Shield of Massachusetts, United HealthGroup, Nationwide Insurance, Sapporo, NYSE Euronext, Virgin Media and others.

The simplicity of deploying Netezza appliances makes this technology ideal for the needs of high-performance analytics, requiring minimal administration and IT skills, and enables clients to run complex data queries within days of deploying the solution.

“Our vision of an appliance-based Intelligent Economy aligns very well with IBM’s Smarter Planet strategy.  Netezza appliances set the standard for performance and simplicity in data warehousing and analytics,” said Jim Baum, President and CEO of Netezza. “Our customers choose our appliances for their fast time to value and how they simplify analytics against big data. Together with IBM, we are looking forward to extending our capabilities to a much broader market.”

For example, with Netezza appliances, NYSE Euronext has drastically cut the time it takes to load and extract massive amounts of historical data so it can run analytic queries more securely and efficiently, while reducing runtimes from hours to seconds.

Virgin Media, a UK provider of TV, broadband, phone and mobile services with millions of subscribers, uses Netezza across its product marketing, revenue assurance and credit services departments to proactively plan, forecast and respond to the effect of pricing and tariff changes enabling them to quickly respond with competitive offerings.

The acquisition expands IBM’s information and analytics offerings, including services available through IBM’s Business Analytics and Optimization Consulting organization.  Today, more than 6,000 IBM consultants are dedicated to analytics.

In the last four years, IBM has invested more than $12 billion in 23 analytics related acquisitions.  In IBM’s second-quarter of 2010, IBM’s analytics business grew 14%.

Following the close of the acquisition, IBM intends to integrate Netezza within IBM’s Information Management software portfolio.

Written by turbotodd

September 20, 2010 at 1:56 pm

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