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Opsware to acquire Rendition Networks

Opsware is purchasing device configuration specialist Rendition Networks for $33 million in cash and stock, a sign that market activity could be picking up as companies look to reduce configuration errors.

IT automation and utility computing vendor Opsware Inc. today announced plans to acquire Rendition Networks Inc., a network device automation and configuration management firm.

Opsware will pay $33 million in cash and stock for Redmond, Wash.-based Rendition, which is best known for its TruControl device management software. TruControl monitors and regulates changes across routers, switches, firewalls and load balancers.

"The combination of world leading server, application and network automation will provide a breakthrough automation solution unmatched in the marketplace," said Ben Horowitz, president and CEO of Opsware, in a statement. "The market demands a solution that takes into account and manages the entire application infrastructure."

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Once the acquisition is complete, Opsware will integrate TruControl with its own server automation and application management system, but will also maintain TruControl as a standalone product. Rendition's research and development team will remain in Redmond under Eric Johnson, vice president of engineering.

Stephen Elliot, senior analyst with research firm International Data Corp., in Framingham, Mass., said Rendition's products represent a natural extension of Opsware's existing server and application management capabilities.

"Rendition is clearly a top-four player in the space from a technology standpoint," Elliot said. "The key challenge for Opsware is keeping the staff that helped build the technology, as well as sales penetration."

With enterprise networks growing more important to maintaining mission-critical enterprise applications, including VoIP, experts expect the device configuration market to grow. According to Meta Group Inc., it's only a $15 million market today, though a number of upstart vendors such as Voyence Inc., AlterPoint Inc. and Intelliden Corp. are expected to push that number upward.

Elliot said that as more enterprises realize that device configuration management can increase their operation efficiency, it's likely that other companies in the space could become acquisition targets as well.

"There's clearly a need for more automation to reduce human error, which causes downtime," Elliot said. "So it wouldn't surprise me to see more acquisitions over the next two years."

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