From competitors to friends; big data behemoths Cloudera and Hortonworks are to merge in a $5.2 billion (£3.97bn) deal.
Cloudera, which went for IPO last year, noted Hortonworks, which went public in 2014, as a competing open source player in its filing to the SEC. The companies are often compared in terms of Hadoop deployments – while the software has the potential to crunch huge amounts of data, it is by no means an out-of-the-box solution. Hence where companies such as Cloudera and Hortonworks come in.
Key considerations to the move included, naturally, value to shareholders, as well as planned financial benefits and product convergence. In particular, the two companies said the accelerated market development would fuel innovation in the Internet of Things, hybrid cloud, as well as machine learning and artificial intelligence.
There is a reasonable boardroom shuffle; Cloudera CEO Tom Reilly will be chief exec of the newly-formed company, while Hortonworks CEO Rob Bearden will join the board of directors. Scott Davidson, chief operating officer at Hortonworks, will become COO at the new company, with Hortonworks chief product officer Arun C. Murthy and Cloudera chief financial officer Jim Frankola doing likewise.
“Our businesses are highly complementary and strategic. By bringing together Hortonworks’ investments in end-to-end data management with Cloudera’s investments in data warehousing and machine learning, we will deliver the industry’s first enterprise data cloud from the edge to AI,” said Reilly in a statement. “This vision will enable our companies to advance our shared commitment to customer success in their pursuit of digital transformation.”
According to a recent study from IDC, revenues for big data and business analytics solutions will hit $260 billion by 2022, with banking, manufacturing and professional services among the industries making the largest investments in the technology.
As the two companies noted, increasing workloads and technological capabilities at the edge, as well as the potential of AI, means getting efficient data processing will be a huge opportunity for businesses going forward. Cloudera and Hortonworks have taken the decision that two heads are better than one in this scenario.
You can take a look at the investor presentation here.
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