VMware buys application performance vendor, sets up shop in Israel

VMware has agreed to acquire B-hive Networks, an application performance management software vendor, the company announced Wednesday.

B-hive is based in San Mateo, Calif., but has R&D facilities in Herzliya, Israel, which VMware said will form the core of a new development center.(Catch up on 2008's hottest tech M&A deals.)

Terms of the acquisition were not disclosed. VMware expects to complete the deal during the third quarter. (Follow along a timeline of all the companies VMware has bought since 2005.)

B-hive software gives customers visibility into how their applications are performing. (Compare Application Performance Monitoring products.) For example, it can tell you how many transactions per second are being processed by a database, or the response time of a Web site, says Raghu Raghuram, VMware's vice president of products and solutions. Because it runs on top of VMware's hypervisor, B-hive software can then dynamically instruct the VMware infrastructure to reallocate resources in response to changing needs, he says.

These capabilities become increasingly important when enterprises use virtualization for production applications such as ERP, databases, and Microsoft Exchange, as opposed to test and development scenarios.

"As virtualization becomes mainstream, our customers are increasingly putting mission-critical applications onto virtual platforms," Raghuram says.

B-hive already sells its "Conductor" software on VMware's Virtual Appliance Marketplace. Such appliances consist of a virtual machine, operating system and the B-hive software in one integrated package.

"Unlike OS-based performance monitoring products, the B-hive solution is designed to measure performance across multi-tier or service-oriented architecture applications that are distributed across clusters of ESX hypervisors and virtual machines," VMware states in a press release.

B-hive is the third company VMware has acquired this year and the ninth since 2005. VMware – which itself is owned by EMC but operated as an independent company – bought application virtualization vendor Thinstall in January, and purchased the services assets of Foedus that same month.

B-hive's R&D center in Israel was one of several reasons VMware made the purchase, Raghuram says. VMware previously didn't have a base in Israel. Going forward, VMware will use the Israeli facility for general development of VMware products, rather than simply continue B-hive's work in application performance management.

"Israel is home to great talent and technology in software," Raghuram says. "This came as the right opportunity to set up shop in Israel."

Raghuram says VMware hasn't decided how to package or price the B-hive products. B-hive CEO Yoay Dembak will apparently have a role with VMware. He is quoted in the press release as saying "our shared goal is to improve the end user experience and maximize the value of investments in VMware virtualization."