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VMware Splashes $4.8B on Strategic AcquisitionsVMware Splashes $4.8B on Strategic Acquisitions

VMware is bolstering its developer support and security capabilities with the acquisitions of Pivotal Software and Carbon Black.

Mitch Wagner

August 23, 2019

4 Min Read
VMware Splashes $4.8B on Strategic Acquisitions

VMware had a lot to say Thursday, reporting not one but two acquisitions jointly valued at US$4.8 billion: Pivotal Software, to enhance VMware's developer support for containerized Kubernetes applications; and Carbon Black for enhanced security. VMware also reported $2.44 billion quarterly revenue, up 12% year-over-year.

The Pivotal acquisition, valued at $2.7 billion, is an odd one, because Dell Technologies owns controlling interests in both VMware and Pivotal, so the two companies are already related. However, the acquisition will enable tighter integration between VMware and Pivotal products, VMware CEO Pat Gelsinger said on the company's earnings call with analysts Thursday afternoon.

The Pivotal acquisition will also give VMware developer support for its multicloud infrastructure platform.

With the Carbon Black acquisition, which VMware values at $2.1 billion, the company is buying a company that has focused on preventive, rather than reactive, security, noted Gelsinger, who referenced his speech at this year's RSA security conference when discussing the deal: "I described the security industry like bad attorneys. They chase around, find the accident, and get more security spend justified after the accident. What a terrible business model," Gelsinger noted.

"A better business model is to prevent the accident from occurring. This, to us, is a very fundamental, disruptive change that's under way," Gelsinger said.

He added, "Our objective is not to build a new business. It is to change the industry, because the industry as we know it today is not working, and as more and more of humanity puts their lives, their financials, their health on the tech platform, they're expecting a much higher return and much better protection of their data and lives than the tech industry is giving. So for us it's a much bigger cause than just building a business unit or starting a revenue line. We're out to change the security industry."

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About the Author(s)

Mitch Wagner

Executive Editor, Light Reading

San Diego-based Mitch Wagner is many things. As well as being "our guy" on the West Coast (of the US, not Scotland, or anywhere else with indifferent meteorological conditions), he's a husband (to his wife), dissatisfied Democrat, American (so he could be President some day), nonobservant Jew, and science fiction fan. Not necessarily in that order.

He's also one half of a special duo, along with Minnie, who is the co-habitor of the West Coast Bureau and Light Reading's primary chewer of sticks, though she is not the only one on the team who regularly munches on bark.

Wagner, whose previous positions include Editor-in-Chief at Internet Evolution and Executive Editor at InformationWeek, will be responsible for tracking and reporting on developments in Silicon Valley and other US West Coast hotspots of communications technology innovation.

Beats: Software-defined networking (SDN), network functions virtualization (NFV), IP networking, and colored foods (such as 'green rice').

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