The 10 Biggest Tech Acquisitions Of 2013

Acquisitions And Buyouts That Changed The Industry Landscape

Acquisitions are a regular occurrence in the IT industry and 2013 certainly had its share. Some IT vendors like Cisco and IBM were as active as ever on the acquisition front while others, notably Oracle, spent less time shopping this year than in recent years.

There were a number of blockbuster multibillion-dollar deals in 2013 that have the potential to remake segments of the industry. But this list isn't based solely on the dollar-amounts of the deals. Some acquisitions are on our list because their potential impact on the industry and the channel outweighed their price tags.

The list also includes one acquisition that just never happened.

10. Western Digital Snaps Up Virident, sTec

Western Digital, a manufacturer of solid-state drives (SSDs) and hard drives, spent more than $1 billion on a pair of acquisitions that stepped up the company's presence in the red-hot flash memory system market.

Most prominent was the announcement in September that Western Digital would buy flash storage developer Virident for about $685 million. While the move strengthened Western Digital's flash storage product portfolio, it was also seen as creating a wedge between Seagate -- Western Digital's arch-rival -- and Virident, which until then had been an important technology and business partner for Seagate. The acquisition was wrapped up Oct. 17.

Earlier in the year, Western Digital struck a deal to buy sTec, an early leader in the SSD market for about $340 million. That acquisition was completed Sept. 17.

9. IBM Buys Trusteer

IBM significantly expanded its footprint in the cybersecurity arena in August when it disclosed a deal to acquire privately held Trusteer, an Israeli developer of software that organizations use to protect against fraud and other advanced security threats.

IBM did not disclose the cost of the acquisition, which closed on Sept. 3. But published reports at the time said the price tag was in the range of $1 billion.

IBM acquired some pretty advanced security technology through the deal, including Trusteer's security-as-a-service technology delivered through the cloud. IBM also said it would open a cybersecurity lab in Israel with Trusteer's operations at its core.

8. EMC Acquires ScaleIO

Data storage giant EMC acquired ScaleIO on July 12 for an undisclosed sum. Published reports at the time put the acquisition price between $200 million and $300 million.

ScaleIO was considered a pioneer in the nascent software-defined storage area, and EMC's acquisition of the company was seen as a potential game-changer, disrupting the way businesses purchase storage systems and impacting how the channel sells both storage and cloud computing.

ScaleIO's Elastic Converged Storage technology creates a virtual pool of server-based storage, using any combination of solid-state devices, PCIe flash cards and hard drives. Potentially scaling to thousands of servers, the technology can eliminate the need for a storage area network.

7. Oracle Buys Acme Packet

This deal, announced in February and completed April 2, flew under the radar for many despite its $2.1 billion price tag ($1.7 billion net of Acme Packet's cash). But the acquisition marked a big step for Oracle's efforts to strengthen its position in the communications arena.

Acme Packet develops session border control technology, a critical element in delivering next-generation voice, data and unified communications services and applications across all-IP networks.

One major set of customers for Acme Packet's products are telecommunications service providers. This year, Oracle sought to position itself as a strategic supplier of software to telecommunications companies, and the Acme Packet buy is a critical element of that effort.

6. Cisco Acquires Insieme Networks

With the software-defined networking market expected to reach $3.7 billion in just three years, SDN got a lot of buzz this year. But for much of the year, Cisco kept the industry guessing about its own SDN strategy -- to the point that some viewed the networking technology giant as late to the party.

That all changed in November when Cisco announced that it would fully acquire Insieme Networks, an SDN startup that Cisco already owned an 85-percent stake in.

The acquisition was seen as a move to not just catch up but also leapfrog the competition -- especially VMware -- in SDN. Cisco said it would make Insieme Networks' application-centric infrastructure technology the core of its SDN strategy.

5. Salesforce Buys ExactTarget struck a deal in June to buy ExactTarget, a developer of software-as-a-service cross-channel, digital marketing applications, for $2.5 billion.

The acquisition, completed July 12, allowed Salesforce to greatly expand the marketing functions of the company's CRM platform, especially around the use of email, mobile communications and social media.

CEO Marc Benioff (pictured) noted at the time that chief marketing officers are wielding more influence on IT spending. Salesforce channel partners said the addition of the ExactTarget technology would give Salesforce users the ability to gain greater insights into their customers' behavior.

4. IBM Acquires SoftLayer

IBM picked up SoftLayer Technologies, a cloud computing infrastructure supplier, in a deal that was announced in June and completed by July 8. Before the deal was officially announced there were reports that both IBM and EMC were vying to buy SoftLayer for as much as $2 billion. IBM did not disclose what it paid.

The acquisition gave IBM's cloud services operations a boost and put it in more direct competition with Amazon Web Services and Rackspace. The deal also expanded the kinds of services IBM could offer managed service providers at a time when IBM has been aggressively recruiting MSP partners.

IBM made SoftLayer the centerpiece of an aggressive marketing campaign it launched against Amazon last month. IBM lost a coveted CIA cloud computing contract to Amazon earlier this year and acquiring SoftLayer is one way the company is trying to make sure that doesn't happen again.

3. Cisco Buys Sourcefire

Few areas are more important for IT managers these days than network security. And that’s an area where networking technology maker Cisco has been in a dogfight with rival Palo Alto Networks.

This year Cisco sought to gain an advantage when it announced in July a deal to buy Sourcefire, a developer of next-generation intrusion detection and intrusion protection systems, firewall software, and advanced malware protection technologies, for a whopping $2.7 billion. The acquisition was wrapped up Oct. 7.

Cisco said the acquisition of Columbia, Md.-based Sourcefire would provide Cisco with "deep security DNA," a skill set that’s become increasingly important given the complexities that mobile computing, cloud computing and the Internet of Everything have introduced into the IT security landscape.

2. Microsoft Buying Nokia

Microsoft is trying to move beyond its desktop software-centric business model and recast itself as a devices and services company. To that end, one of its biggest moves has been the $7.2 billion deal to acquire Nokia's devices and services business announced Sept. 3. The acquisition has won approval from Nokia shareholders and the European Commission and is expected to close in early 2014.

Microsoft sees Nokia as a way to turn around its lagging position in the mobile phone business. The Windows Phone mobile OS has low single-digit market share against Apple's iOS and Google’s Android software. And on the handset side, the Microsoft Kin was an outright failure.

Nokia and Microsoft already had a tight relationship after the two companies struck an alliance in February 2011 to develop a mobile device ecosystem around Microsoft Windows Phone software -- an investment that reportedly cost Microsoft billions. But Microsoft, apparently, concluded that just wasn't enough.

1. Dell Buys Dell For $24.9 Billion

The biggest acquisition of the year wasn't a case of one company buying another. It was Dell CEO Michael Dell buying his own company, taking the computer maker private with some help from financial investors for a price tag of $24.9 billion.

It wasn't easy. Dell disclosed the plan in February after weeks of reports and speculation. But what seemed like a straightforward proposal turned into a months-long battle with activist investor Carl Icahn over the future of the company before Michael Dell finally prevailed in September.

So what happens now? Michael Dell has already shaken up the company’s U.S. management team. And the company has already taken some steps that indicate a more channel-focused approach to sales. But it's early yet. The only thing we can be sure of is that the impact of this acquisition will be felt deep into 2014 and beyond.

IBM And Lenovo: The Acquisition That Wasn't

In April, a CRN report that IBM was in talks to sell its x86 server business to Lenovo set the industry buzzing. IBM, which has appeared increasingly focused on its software and service offerings in recent years, has been struggling to grow its server hardware sales. Still, the reported move took everyone by surprise.

Lenovo acknowledged that the talks were underway. But IBM never went beyond saying it was considering divesting itself of poorly performing businesses.

But the two companies never pulled the trigger on the deal. In May, CRN reported that the talks had broken down over "valuation concerns."