Microsoft acquires Opalis Software – UPDATED

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Last Friday Microsoft announced the acquisition of Opalis Software, a run-book automation company founded in 1998 in Canada with 70 employees (according to LinkedIn) and over 300 customers (according to Opalis).

Data center orchestration is one of the most important areas where virtualization will expand in the coming years, as soon as customers will realize that their virtual infrastructures are reaching such a scale and complexity to become inefficient.

VMware and Citrix already invested in this area.
VMware acquired the Swiss startup Dunes Technologies in September 2007, and it’s now offering their solution for free, as part of vSphere 4.0 platform, under the name of Orchestrator.
Citrix offers an orchestration framework called Workflow Studio since January 2009.

Microsoft isn’t shy to say that the Opalis Software technology will be integrated in its System Center portfolio and that it will serve as the automation layer for Hyper-V virtualization and Azure cloud computing.

With this acquisition Microsoft doesn’t need much more to compete end-to-end against VMware on virtualization. Yes, the company still doesn’t have a client hypervisor, and didn’t clarify if it plans to become a major VDI player on its own or not, but the technology to deliver both missing pieces is there.
The Microsoft problem is that its vision about virtualization is nowhere near the VMware’s one. They have a lot of products which could be integrated to form an impressive end-to-end offering, but the today’s reality is completely different. And of course the customers’ trust in the Microsoft capability to compete with VMware reflects this.

Update: In October, The 451 Group analysis firm reported that this acquisition is around $60M.
Opalis raised $25M in venture capital funding and scored over $10M in revenue.