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CA Buys NetQoS – Quick Analysis

NetQoS Symposium Badge Stickers

CA announced this morning the acquisition of Austin-based NetQos for $200 million (press release). In this space, I always disclose that I’m not really a network management guy – I know there’s an alphabet soup of “flows,” there’s something about “packets,” and I hear Cisco used their strength in this space to build up to a “collaboration platform.” That said, I’ve following NetQoS over the years, I’ve been impressed with their offerings, primarily gauged by the engagement and enthusiasm of their user-base.

To call a 10 year old company a “startup” is a bit silly, but they have come to that startup-like narrow focus that’s let them become good at the “one thing” they do, network performance monitoring and diagnosis. That strategy seems to have worked well for them, as the press release says:

NetQoS has more than 1,000 active customers worldwide, including many in the Fortune 100. With annual revenue of $56 million in 2008, NetQoS’ revenues have experienced a 58 percent CAGR over the past five fiscal years.

Check out the ManageEngine commentary for the less rosy take – the ZoHo folks never miss a good chance for a chipper jab ;>

NetQoS’ blogging program has always been a stand-out for me in the space as well. It’s hard to maintain attention around something as dull (to most folks) as network management, let alone find something to blog about, but they’ve done a good job over there.


Enchiladas at Jaime's

One of the last times I talked with them, I heard about their involvement with NBC delivering the Olympics with Silverlight last year over some enchiladas at Maudie’s earlier this summer with Patrick Ancipink. While that scenario isn’t really “cloud computing” centric, it gives an idea for the types of network traffic management problems we can expect to see more of int he future. Each time we grow the pipes bigger, we jam more stuff into them, and that Netflix Watch Instant sure is nice.

In theory, as others have pointed out, CA has an interesting cloud portfolio with the Cassatt assets, their existing offerings, and this NetQoS fitting in as management software to monitor and diagnose networking problems in the cloud. The level of discussion in cloud computing hasn’t really gotten to the long-term management aspects yet – it’d sort of be admitting defeat to talk about the need to manage a self-managing system at this point, beyond provisioning. In the happy-path, perhaps CA is putting down long-term bets here: once the cloud mess grows, you’ll need the usual mess removal apps, process, and Big 4 help. I wouldn’t bet either way at this point.

That said, you can’t really duct-tape together a cloud portfolio though, there’s a strong need to re-tool existing assets to fit the promises of the slide-ware. Most Big 4 companies take about 1-2 years and a handful of acquisitions to do this re-tooling. IBM has been on the path since they got cloud religion about a year ago, and the rest of the Big 4 have been catching up. You have to have a little sympathy for them: virtualization was the salt of the earth darling there for a year, and right when they all got geared up around that (after getting over their SOA romance), along came cloud and rejigged the dance card line-up. But, hey, you gotta talk the talk. Thankfully, cloud computing is looking to be as real and beneficial as virtualization, and the whole private cloud school is gravy for incumbent IT management vendors. And then there’s the bulk of good old fashioned IT management still left to do.


Of special note, since I’m a local, is the effect this has on the Austin scene. As Mike Maples Jr. said at the Capital Factory Demo Day last week, Austin has a good background in IT management software and companies. Everyone gets excited down here when an IT management guy gets and exit.

There’s several large companies in IT Management whose road-map points towards the need to update their portfolio here and there, esp. when it comes to virtualization and cloud management. And, as always, some potential suiters could do with a few fresh injections of good old fashioned IT management.

Disclosure: IBM is a client, as are many folks in the cloud IT management space, big and small: see the RedMonk client list.

Categories: Systems Management.

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One Response

  1. “it’d sort of be admitting default to talk about the need to manage a self-managing system at this point, beyond provisioning”

    ?? I hadn’t heard that magic had happened and that these systems weren’t going to need management. Anything with networks and servers is going to need monitoring as well as provisioning, and adding virtualization will just add complexity and the need for more visibility.