According to Neowin, IBM is in advanced talks to acquire the data infrastructure firm Confluent for a reported $11 billion. The deal, originally reported by The Wall Street Journal, could be officially announced as soon as Monday, December 8. Confluent, which has a market cap of $8.09 billion, provides an open-source platform for processing massive real-time data streams. This move follows IBM’s $6.4 billion acquisition of HashiCorp earlier this year and comes as CEO Arvind Krishna seeks to boost software performance amid slower growth in IBM’s core cloud business. The company has been valued at $287.84 billion, and Confluent has reportedly been weighing a sale since October.
IBM’s Cloud Catch-Up Game
Here’s the thing: this feels like a very expensive, but potentially necessary, game of catch-up. IBM’s cloud software growth has been lagging, and that’s a problem when every other tech giant is shouting from the rooftops about their AI and data capabilities. Buying Confluent isn’t just about getting a slick data streaming platform. It’s about buying a ticket to the main event. Real-time data processing is the absolute lifeblood of generative AI and modern applications. Without it, you’re basically trying to race a sports car on an empty tank.
The Bigger Trend at Play
And IBM isn’t alone in this shopping spree. Look at Salesforce grabbing Informatica for $8 billion back in May. There’s a clear trend here: legacy enterprise giants are realizing their traditional software stacks aren’t built for this new, hyper-connected, AI-driven world. They can’t build this stuff fast enough internally, so they’re opening their wallets. They’re acquiring the modern data plumbing they desperately need to stay relevant. It’s a race to own the entire data stack, from storage to processing to analytics, and the price tags are getting astronomical.
What It Means for the Market
So, what happens if this deal goes through? First, it validates the insane value of data infrastructure companies in the AI era. An $11 billion price tag for a company built on open-source Apache Kafka is a statement. Second, it puts immense pressure on other big players like Oracle, SAP, and even the cloud hyperscalers. The consolidation wave is real. For customers, it’s a mixed bag. On one hand, getting a unified data and cloud story from a single vendor like IBM can simplify things. On the other, there’s always the risk that innovation slows down once a vibrant open-source-led company gets absorbed into a massive corporate machine. Will Confluent remain the agile platform it is today? That’s the billion-dollar question. Or, in this case, the $11 billion one.
