Why Is IBM Acquiring This AIOps Firm?

IBM is all set to acquire Turbonomic, the latest in a string of cloud computing acquisitions by the tech giant. Boston – based Turbonomic is an AI-powered application resource management company. The acquisition will help IBM boost its full-stack application observability and management efforts to ensure better performance and minimise cost using AIOps. 

“By acquiring Turbonomic, IBM is the only company that will be able to provide customers with AI-powered automation capabilities that span from AIOps (the use of AI to automate IT Operations) to application and infrastructure observability – all built on Red Hat OpenShift to run across any hybrid cloud environment,” the company said in a statement.


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Also read, Why did Microsoft acquire Nuance?

IBM – Turbonomic deal

The deal set for more than $1.5 billion will complement IBM’s recent acquisition of Instana. IBM has been putting in considerable efforts to provide its customers with AIOps alongside infrastructure observability and applications. Customers can save money by using AI to optimise IT resources’ deployment and reduce the time required for troubleshooting, with the integration of Turbonomic, Instana, and Watson AIOps capabilities. The transaction is expected to close by the second quarter of 2021.

“We believe that AI-powered automation has become inevitable, helping to make all information-centric jobs more productive. That’s why IBM continues to invest in providing our customers with a one-stop shop of AI-powered automation capabilities that spans business processes and IT. The addition of Turbonomic now takes our portfolio another major step forward by ensuring customers will have full visibility into what is going on throughout their hybrid cloud infrastructure, and across their entire enterprise,” said Dinesh Nirmal, General Manager, IBM Automation.

The adoption of 5G has forced enterprises to shift their workloads to the edge. Hence networking has become an integral part of the application deployment process. The strong presence of Turbonomic in the telecommunications industry and its NPM products will provide IBM’s customers with additional offerings and capabilities to optimise their applications running on 5G networks.

Founded in 2010, Turbonomic has worked in the past with Cisco, IBM, AWS, Verizon and Microsoft to cater to more than 3,000 customers worldwide. 

The company has announced a 41% year-on-year revenue growth for FY 2021. In the recent past, Turbonomic has promoted Steve Corndell as the Chief Revenue Officer (CRO). Matt Poulton joined as VP & GM of Europe, Middle East, and Africa (EMEA) to drive growth and expansion of the company in FY22. However, the deal has yet not disclosed any leads on the organisational working structure.

IBM’s toolkit

The global automation industry is estimated to generate a revenue of around $214 billion in 2021. The industrial software alone is expected to account for $43 billion in the same year, as per the report from Statista

IBM recently acquired Italy based MyInvenio, a process mining software provider. The Big Blue also bought WDG Automation, a robotic process automation (RPA) company, last year. 

MyInvenio: Upon the closing of the deal, businesses will be able to use data-driven tools to help identify the most critical business processes to automate with AI, such as sales, accounting etc. It also strengthens IBM’s hybrid cloud and AI strategy by providing customers with a broad range of AI-powered business automation capabilities.

IBM Cloud Pak System: It is a turnkey private cloud solution to simplify the deployment and management of an enterprise-grade private cloud for VM and container-based applications while avoiding the cost and complexity of conventional private cloud solutions.

WDG Automation: As a result of this acquisition, IBM can now host its RPA tools inside its product suite. Customers who are either using or considering using IBM tools will no longer need to go to an outside vendor for RPA.

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kumar Gandharv
Kumar Gandharv, PGD in English Journalism (IIMC, Delhi), is setting out on a journey as a tech Journalist at AIM. A keen observer of National and IR-related news.

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