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VMware to Buy SpringSource for $420M

springsource_logoVMware (s vmw) today said it’s agreed to buy SpringSource, maker of an open-source platform for Java developers, in a cash-and-stock deal valued at $420 million.  The virtualizaiton vendor will acquire SpringSource for roughly $362 million in cash and equity plus the assumption of some $58 million of unvested stock and options. It’s just the latest example of how the cloud platform wars are heating up. And as with other platform wars — whether they’re taking place in Apple’s App Store or on Facebook — the developers look to be the big winners.

“Within the new world of cloud computing, developers have a huge amount of influence over which cloud services get used,” said Kevin Efrusy, a partner with Accel Partners, which invested in SpringSource. Part of the reason VMware was interested in SpringSource, he said, was because it “represents this large and powerful community.”

He noted that VMware can now tightly couple its virtualization software with SpringSource’s open Java development platform to add value. VMware seems to be planning to create a platform as a service that’s built using its hypervisor and SpringSource’s open Java platform. Such an effort might compete with more specialized PaaS offerings such as Google’s (s goog) AppEngine, Microsoft’s Azure and Rackspace’s (s rax) Mosso efforts. From the press release:

Together, VMware and SpringSource plan to further innovate and develop integrated Platform as a Service (PaaS) solutions that can be hosted at customer datacenters or at cloud service providers. These solutions will allow customers to rapidly build new enterprise and web applications and run and manage these applications in the same dynamic, scalable and cost-efficient vSphere-based internal or external clouds that can also host and manage their existing applications, providing an evolutionary path to the future.

That’s similar to something I said when SpringSource earlier this year purchased cloud management vendor Hyperic. At the time, I noted that the deal could help SpringSource become a more powerful player in the enterprise software market by allowing it to control more aspects of the software development and management process.

SpringSource, which makes the open-source Java application framework Spring Framework, can use its acquisition of Hyperic, which makes IT management software, to manage the entire process of building a Java application and then running it…The combination of a development framework and monitoring applications will help SpringSource take on larger competitors such as Microsoft or IBM (s IBM), both of which also control development environments as well as the management tools for the software built on their various platforms.

So now VMware can take SpringSource’s Java tools and community and use that to pitch a platform to both company’s customers, who are likely already comfortable with both SpringSource’s Java platform and VMware for virtualization. For enterprise customers, such a platform-as-a-service offering combines two trusted brand names. Plus, many of them already have built applications using the SpringSource framework, so moving them over to a SpringSource-based platform in the cloud may be an easier step.

The acquisition has been approved by SpringSource’s stockholders and is expected to close in the third quarter of 2009.

12 Responses to “VMware to Buy SpringSource for $420M”

    • Stacey Higginbotham

      Nice interview, Sramana. I especially like Johnson’s admitting that SpringSource was an iterative process rather than an idea that suddenly was scribbled on a cocktail napkin and then flourished. It’s nice to see that sometime a good idea will come back and haunt you until you do something with it.