Oracle Buys Virtual Iron, Virtualization Management Startup Strengthening Oracle VM

Watch out VMware! Oracle buys Virtual Iron, terms undisclosed.

Founded in 2003, Virtual Iron provides cost-effective, production-ready server virtualization software for small and medium-sized enterprises (SMEs). The solutions deliver comparable capabilities to VMware without the cost and complexity. The company is led by an experienced management team and backed by top-tier investors including Highland Capital, Matrix Partners, Goldman Sachs, Intel Capital and SAP Ventures.

Market penetration of the virtualization market is still less than 10 percent with VMware controlling much of the market share.



Strategic Rationale for the deal:
• Adds advanced virtualization management technology to enhance Oracle VM
• Transaction expected to close this summer
• Virtual Iron is a provider of server virtualization management software
• Private company, headquartered in Lowell, Massachusetts
• Virtual Iron’s software enables dynamic resource management in virtualized data
centers
• Proven implementations across industries such as government, healthcare, financial
services, IT software and service, manufacturing and communications
• Virtual Iron extends Oracle VM software to provide comprehensive and
dynamic resource management across the full stack
• Oracle VM’s scalable, high performance server virtualization capabilities provide high
availability and rapid deployment for Oracle’s comprehensive software stack
• Virtual Iron is expected to add advanced dynamic resource management automation
and streamlined virtualization server configuration capabilities to Oracle VM


Industry trends are driving demand for virtualization
• IT organizations need to reduce operating expenses without sacrificing quality of
service
• Enterprises want to shorten the time required to deploy or reconfigure applications
• Companies are seeking “Green” strategies to reduce their carbon footprints and
decrease their total power consumption
• Virtualization changes the way applications are deployed and managed
• Pre-built virtual machines enable faster application deployment and configuration
• High availability is delivered by default for all hosted application components
• Dynamic resource management and rules-based automation facilitates more efficient
management of application service levels
• Consistent with Oracle’s strategy to provide comprehensive full stack
enterprise management across the virtual and physical enterprise
• Oracle VM with Virtual Iron management technology is expected to provide more
comprehensive, dynamic resource management capabilities
• Expected to enhance Oracle Enterprise Manager to be more agile in meeting
application service levels in virtualized environments

Blodget: 5 Reasons Google Should Buy Twitter for $1 Billion

From Henry Blodget - If Google were to acquire Twitter, Google should buy the company for $1 Billion
1. Google needs a huge new growth engine and Twitter might just fit the bill.
2. Twitter is a hell of a lot more relevant to Google's business than other big Google ideas, such as YouTube...
3. $1 billion is couch change for Google.
4. Twitter could conceivably threaten Google's cash cow--search.
5. Like Google, Twitter is already a verb.
We hope Google has a better strategic rationale for acquiring Twitter beyond buying into the hype.

Twitter has raised ~$55 million in funding from venture capitalists including Institutional Venture Partners, Benchmark Capital, Union Square Ventures, Spark Capital and angels Ron Conway, Mike Maples Jr., Chris Sacca and Betaworks.

Google Announces Venture Fund - $100MM

Google announces venture fund - expected to invest $100 million in the next tweleve months. Google Ventures will be part of Corporate Development led by David Drummond, SVP, Corporate Development and Chief Legal Officer.
Google Ventures has already invested in Silver Spring Networks, which provides technology to help manage electric grids and Pixazza, which links online images with related products that can be purchased.
Email all your great ideas to ventures@google.com
Partners:
Bill Maris is a Managing Partner of Google Ventures. Bill brings more than a decade of diverse operational, entrepreneurial and leadership experience to Google Ventures. Bill's past successes include founding Web hosting pioneer Burlee.com, which he subsequently sold to Interland, Inc. (NASDAQ: WWWW), now known as Web.com. Prior to that, Bill was a portfolio manager for Stockholm, Sweden-based Investor AB, one of the world's largest industrial holding companies, where he co-managed the biotechnology and health care portfolios. Bill’s background also includes scientific research into cholinergic visual pathways, cell membrane patch clamping techniques and in-vivo neuronal cell injection at Duke University Medical Center, Department of Neurobiology. Bill is based in Mountain View, CA and received an A.B. with honors in Neuroscience from Middlebury College.
Rich Miner is a Managing Partner of Google Ventures. He has spent the past 25 years growing businesses with innovative communications and interface-intensive applications. Rich joined Google through the acquisition of Android, a mobile platforms company.
http://www.google.com/ventures/index.html

Dealbook: For would-be Twitter Acquirers - Beware of Buyers' Remorse

What were they thinking? AOL’s $4.2 billion acquisition of Netscape, and eBay’s $4.1 billion acquisition of Skype.

From Dealbook:
Whoever buys Twitter, they wrote, “will likely have to operate it at a loss in perpetuity, or until the next cool Web 2.0 social networking concept comes along and Twitter tweets no more.”


All That Twitters May Not Be Gold, Analysts Say
Twitter seems to have gone from obscure to mainstream in about the same time it takes to send a “tweet” over the network.

Despite the fact that the three-year-old microblogging service doesn’t generate revenue — never mind profits — there is already chatter about who might want to buy it.

However, analysts at Sanford Bernstein believe that potential acquirers for Twitter should think twice.

In a research note published late last week, the analysts argued that the Web 2.0 model of building a product and then figuring out how to monetize it has been largely debunked.

The Web is littered with examples of promising but ultimately value-destroying acquisitions, they wrote, citing deals such as AOL’s $4.2 billion acquisition of Netscape, and eBay’s $4.1 billion acquisition of Skype.

The analysts said that monetizing Twitter “would be difficult at best and likely unsuccessful.” People who sign up for free services tend to resent a company for trying to wring revenue from the business later. Subscription fees are out of the question, they said, and advertising-based revenues don’t seem to have yielded enough cash flow to make a Web 2.0 property viable.

Speculation about Twitter has been echoing in the yellow hills surrounding Silicon Valley lately. The chief executive of Google has been peppered with questions about whether the Web search giant might have its eye on Twitter.

But the Sanford Bernstein analysts think Google would do best to steer clear, as it is still struggling to make money from YouTube, a previous takeover target, and the social networking site Orkut, which it created in-house.

Whoever buys Twitter, they wrote, “will likely have to operate it at a loss in perpetuity, or until the next cool Web 2.0 social networking concept comes along and Twitter tweets no more.”

Last fall, reports surfaced that Facebook offered Twitter 3.33 percent of its privately held stock, which it had determined was worth $500 million, based on a $15 billion valuation for Facebook that was set when Microsoft invested in the company a year ago.

Twitter balked, and raised funds on its own instead.

How will Twitter make a profit? The company freely acknowledges that it’s not quite sure:

“Twitter has many appealing opportunities for generating revenue but we are holding off on implementation for now because we don’t want to distract ourselves from the more important work at hand which is to create a compelling service and great user experience for millions of people around the world,” Twitter says on its “about” page. “While our business model is in a research phase, we spend more money than we make.”