HP to acquire Opsware in $1.6 billion deal

Purchase brings HP data center automation technologies.

HP to acquire data center automation vendor Opsware to help customers reduce the complexity of managing sophisticated application environments.

HP on Monday announced it had entered into an agreement to acquire data center automation vendor Opsware for approximately $1.6 billion.

The deal, expected to close before the end of HP's fiscal fourth quarter, will enable HP to offer its customers a "comprehensive and fully integrated solution for IT automation," HP says.

Opsware, which acquired run-book automation vendor iConclude earlier this year, develops software to automate server provisioning and configuration across network devices. The company was co-founded by Marc Andreesen, best known for his contributions to early Web browser technology and as a co-founder of Netscape.

The automation technology, HP says, will be incorporated into its Business Technology Optimization (BTO) portfolio, which is partly comprised of technology acquired in 2006 when HP put down $4.5 billion for Mercury Interactive.

When integrated, HP says Opsware technology will enhance HP's products with process automation and remove the latency associated with multiple changes and actions that need to be taken across complex IT environments.

"The acquisition of Opsware is intended to enable HP Software to help our customers resolve one of their critical pain points; controlling the increasing complexity and cost of managing the data center," said Thomas Hogan, senior vice president of HP Software, in a press release.

The news comes on the heels of BMC's announced acquisition of RealOps last week, and the Opsware buy follows HP's June announcement that it would acquire Web application security vendor SPI Dynamics for an undisclosed amount. And industry watchers have recently begun speculating that the big four management vendors -- BMC, CA, HP and IBM -- would be venturing into data center, IT process and run-book automation technologies as vendors such as Opalis, Network Automation and Optinuity, among others, gathered steam in enterprise IT accounts.

“The next big step for the big four management vendors is a move into automation in the areas of active configuration management and dynamic resource allocation. It will be a big disruptive play and a defining technology when they move into automation technologies,” said Will Cappelli, a research vice president at Gartner, in a recent interview with Network World. “It will be more of a challenge for BMC and CA than for HP and IBM because the latter have server and storage technologies from which they can incrementally grow. BMC and CA will have to almost spring into the market with a fully shaped technology through acquisition.”

Following the close of the transaction Opsware will become part of HP Software business, and Opsware CEO Ben Horowitz is expected to lead the BTO organization at HP reporting to Hogan.

"We are about to see one of the biggest application and infrastructure build-outs in history," Horowitz said in an HP press release.

HP is expected to share more details of the deal in a press conference on Monday.

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