IBM Flexes Analytics Muscle With $1.7B Netezza Buy

The acquisition of Marlborough, Mass.-based Netezza will help IBM bolster its business analytics initiatives and help clients get insight into business information. Netezza makes a high-performance analytics tool in a data warehousing appliance. The company contends that its appliance can be up and running in hours and handle complex analytic queries 10 times to 100 times faster than traditional systems.

Armonk, N.Y.-based IBM's planned acquisition of Netezza comes on the heels of a Global IBM Study that found that 83 percent of CIOs identify analytics as a top priority. And IBM has been bracing itself for the analytics boom. Over the past four years, IBM has spent more than $12 billion on 23 analytics-related acquisitions. That activity has helped IBM's analytics business grow 14 percent in 2010's second quarter, the company said.

Adding Netezza to the fold will help IBM expand its information and analytics offerings, including its Business Analytics and Optimization Consulting organization, the company said.

"IBM is bringing analytics to the masses. We continue to evolve our capabilities for systems integration, bringing together optimized hardware and software, in response to increasing demand for technology that delivers true business value. Netezza is a perfect example of this approach," Steve Mills, senior vice president and group executive, IBM Software and Systems, said in a statement. "Netezza strongly complements our business analytics capabilities and client base. Together, we have the opportunity to quickly leverage the technology and accelerate the offering."

The acquisition follows a tight partnership between IBM and Netezza, in which Netezza designed and developed its appliances on IBM systems technology and tied in IBM software to power applications within organizations. Together, the companies focused on workload optimized systems that deliver integrated systems, software and storage for analyzing data.

The acquisition, Netezza President and CEO Jim Baum said, will help the pair reach new markets and customers.

"We'll be able to create business solutions with appliance-level simplicity, incredible return on investment for those customers that actually help them change fundamentally the way they do business," Baum said in a video announcing the acquisition plans.

IBM's Netezza buy is the most recent in a string of high-profile acquisitions by the company. Last week, IBM revealed its plans to purchase privately held OpenPages, maker of risk and compliance management software. The OpenPages acquisition follows a dozen other acquisitions IBM has made in 2010 as it averages better than 1.5 acquisitions per month.