TheOpenAnalyst

At the beginning of last year, we predicted that 2008 would set a new record in terms of the amount of mergers and acquisitions related to open source software vendors. A look back at the year-end numbers indicates that we were a bit overconfident. In fact, 28 M&A deals were recorded by The 451 Commercial Adoption of Open Source (CAOS) research service in 2008, compared to 34 in 2007. The slowdown is not surprising given the 40% reduction in M&A activity in the industry as a whole in 2008. In that context, M&A activity involving open source vendors can be seen to have outperformed the wider industry.

With economic conditions forcing companies to do more with smaller budgets in 2009, it is expected that there will be increased interest in, and use of, open source software this year. Does that make open source vendors more or less attractive as acquisition targets? In this report, we examine some of the reasons why open source might buck the trend in the coming year and see an increase in M&A activity despite the fact that overall M&A activity in the technology industry is expected to be down on 2008.

Opportunities for open source M&A in 2009 -| The 451 Group

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