IBM announced yesterday that it has entered an agreement with Vista Equity Partners to purchase tech spend management company Apptio for US$4.6 billion.
IBM says that the acquisition will help clients around the world optimize their enterprise IT spend and manage the increased complexity of businesses using multi-cloud environments.
“Technology is changing business at a rate and pace we’ve never seen before,” said Arvind Krishna, chief executive officer (CEO) of IBM. “To capitalize on these changes, it is essential to optimize investments which drive better business value, and Apptio does just that.”
Apptio offers financial and operational IT management and optimization (FinOps) software to more than 1,500 clients, including Amazon, Microsoft and Google.
FinOps is “red hot right now,” said Tracy Woo, senior analyst at Forrester. “It’s more than lowering costs, it’s about driving efficiency,” especially as enterprises navigate the economic slowdown. Cloud infrastructure, she added, is also a major part of most enterprise infrastructure strategies. And with that comes the need “to marry the old with the new,” which she deemed to be the main friction point, notably with hybrid cloud.
“This is an area where Apptio very squarely sits on top of,” affirmed Woo. “They have their traditional IT financial management solutions that are looking specifically at a very traditional predictable on-premises IT spend. They also have credibility that is all about dealing with dynamic scalability and the fast changing pricing that is an issue with cloud cost management right now.”