Why IBM passed on JBoss acquisition

IBM considered acquiring open-source Java middleware company JBoss, but chose to go a different route for the both financial and technical reasons, said Steve Mills, senior vice president and head of IBM's software group.

Oracle and JBoss are rumored to be in negotiations over a JBoss acquisition. The price tag for such a deal is reported to be between $200 and $400 million.

Like Oracle, IBM has a closed-source line of Java middleware called WebSphere.

In May last year, IBM purchased Gluecode, a small company with less than 15 employees which was building a support business around the Apache Geronimo project, an open-source Java application server.

Gluecode appealed to IBM in part because it was small and new enough to be acquired for a "modest" amount, Mills said. "I don't want to pay large sums of money in this area because it doesn't grow the way a normal software business grows," he said.

IBM has not publicly disclosed the purchase but an IBM insider confirmed that transaction was valued at substantially less than $50 million.

Big Blue also had issues with JBoss' technology, said Mills. JBoss' Java application server contains a significant proprietary component even while it adheres to the Java 2 Enterprise Edition standards.

"JBoss has a lot of proprietary JBoss. It's sort of a hybrid model of open source," Mills said.

On a technical level, Gluecode's strategy better fit IBM's overall software strategy of sticking to industry standards. And Gluecode had a strong affiliation with the Apache Geronimo project, he said.

"As a technology and as a company, (Gluecode) had a reputation of adhering to open community standards and practices."

The roots of Gluecode are at JBoss. A small group of developers left their employment at JBoss in 2003 to start the Apache Geronimo project. Apache Geronimo was certified to meet the Java 2 Enterprise Edition standard in October last year.

IBM has rebranded Gluecode as WebSphere Community Edition. It sells support services around the software primarily to smaller businesses.