Hadoop powerhouses Cloudera and Hortonworks join forces to fight Cloud

Following the announcement of a significant dip in first-quarter operating profit for Takeda,Brad Shimmin, Service director at GlobalData, a leading data and analytics company, offers his view on this important merger:

“Big data platform heavyweights Cloudera and Hortonworks have agreed to an all-stock merger of equals, leaving the market with only a meagre few, dedicated Hadoop distribution rivals to stand up against hyperscale platform players in the race to the cloud.

“On paper, this merger has very little downside, as the two firms will come out with $720 million in combined revenue, more than 2,500 customers, and debt free $500 million in cash. Both companies estimate that this deal will result in a substantial reduction in overall operating costs (to more than $125 million in annual cost synergies), allowing for a more focused effort on opportunities such as Internet of Things (IoT), Artificial Intelligence (AI), hybrid cloud, and streaming analytics.

“But, the true importance of this merger revolves around the dominance of the cloud as a viable big data platform not just for smaller SMBs but for larger, multinational concerns in need of both scale and functionality.

"Both, Cloudera and Hortonworks have done well in delivering pure play Hadoop, and related big data, technologies to customers seeking to simplify the demands of standing up a complex set of open source software (OSS) offerings on premises via respective efforts focused on either proprietary tooling (Cloudera) or support services (Hortonworks).

"But, with the self- same OSS software appearing on hyperscale cloud platforms from Microsoft, Amazon, and Google, it has become increasingly difficult for either vendor to match pace with these cloud-first rivals.

“In the context of the broader Enterprise Data and Analytics marketplace, we do not expect this merger to turn the tide against these cloud platform providers. That said, given the extensive on-premises experience (and supportive partner ecosystem such as including Dell EMC and Intel), enjoyed by Hortonworks and Cloudera, the deal will indeed help the two companies differentiate in supporting customer demand for solutions that are hybrid cloud/premises in nature and capable of taking a fully agnostic view of multi-cloud data integration."