Your tech vendor's been gobbled up: Now what?

By , Network World |  Hardware, m&a

Brocade's acquisition of Foundry Networks took Foundry customer LINX by surprise.

The London Internet Exchange had been using Foundry's switches and routers for 10 years, and the vendor showed no signs of being an acquisition target or candidate.

"Those signs tend to be rather obvious," says LINX CEO John Souter. "They weren't necessarily showing those signs when the Brocade thing happened."

2010 Tech M&A Deals

Souter and his colleagues at LINX went through a range of emotions when the news broke in July 2008 of Brocade's $3 billion offer. Especially since LINX didn't know a whole lot about Brocade.

"We're not users of SAN technology," Souter says. "We asked the people who were deploying the Brocade technology what they thought and generally got very encouraging noises. Since then ... we're really encouraged."

Souter's reactions are typical of a customer of a company being acquired. Users worry that their investments and assets might be stranded or neglected after their primary vendor is purchased, due to product streamlining, an exodus of expertise, strategic refocus, or all three.

After a lull in high-tech acquisitions during the recession, merger and acquisition activity has picked up again and some analysts predict that further big deals lie ahead. For customers, such large acquisitions can create worry and uncertainty, throwing into question future plans and the stability of projects underway.

Andrew Poodle is going through his second such situation. Poodle and his Craftspeed Web site development company use the MySQL database in its clients' projects. He was a MySQL user when Sun Microsystems bought MySQL in 2008, and it was déjà vu all over again for Poodle when Oracle bought Sun 

"When the takeover was announced there was initially some worry and concern," Poodle says. "The transition itself has been relatively painless in terms of the interaction between customer and MySQL. We still talk to the same people who have the same knowledge and passion for a product they have helped develop. The day-to-day stuff hasn't changed, but I think that's not where the worries and concerns lie."

Oracle appears to be putting more emphasis on the enterprise version of MySQL than on the product's community edition, Poodle says. Resources available to community users are less apparent than they are to customers of the enterprise edition, he says.


Originally published on Network World |  Click here to read the original story.
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