Why we acquire what we acquire?

In 2007, Information Management announced plans to acquire 4 companies -- though two are yet to close. 

1. Data Mirror -- for change data capture, helping our integration line of business,
2. Princeton Softech -- for data archiving, helping our database line of business
3. Cognos -- for business intelligence, will become its own line of business
4. Solid -- in memory and embedded database, helping our database line of business. 

So why acquire?  Is our own engine of innovation sputtering?  Far from it, though sometimes, a case can be made that we should have had our ducks in a row to do this ourselves (e.g., we had many main memory database activities in research, but were not able to gel them into a coherent project).  But three main points need to made with respect to innovation and acquisition...

1. Acquiring new genes is always good, and acquisition is a good model for new genetic injections.  For example, our client's environments are heterogeneous, as much as we would like them to throw out the bad guys.  So skills such as Princeton's or Data Mirror's are welcome skills.
2. Acquisitions are no substitute for organic innovation, or in general speak, our core products (or products that have reached some age even after acquisitions) need to innovate to grow in the market, so in fact, innovation through acquisition represents a reasonably small fraction in a large portfolio such as IBM's, even if they garner a lot of attention.
3. Sometimes innovations in market and go-to market are also needed, especially in a consolidating industry such as software, and Cognos would be a great example of such a characteristic in an acquisition in addition to all the technical innovation we get alongwith it.

More on each of these acquisitions over time.  I am excited that 99.8% of the shareholders have approved the Cognos acquisition, so we are all looking forward to all the final approvals and have our fingers crossed.
Of course,

Comments

[Daniel Krook]

Hi Anant,

Would you consider CouchDB an "acquisition," given that Damien Katz was hired into Information Management and the CouchDB project slated to become an Apache project with IBM's help?

Damien's provided his own take on the matter at damienkatz.net, but how do you see it?

[Anant Jhingran]

Daniel,
No. I hired Damien for the explicit purpose of making sure that the open community can continue this fascinating experiment of CouchDB (and of course, who knows, we might be interested in embedding CouchDB in something we do, but right now it is all about the open experiment). Plus, as you know, we/I believe a lot in the open innovation model, so having some new genes in the form of Damien is always exciting.