M&A: Microsoft buys the *assets* of Interactive Supercomputing

As seen on InsideHPC, John West notes that the assets of Star-P were purchased by Microsoft today.

Parsing of words is important. The phrase “acquired the assets of X” means that the IP was purchased. John points to the blog post where Kyril Faenov mentions that some of the staff will work at the Microsoft Cambridge site.

This is sadly, not a great exit for Star-P.

Acquiring assets usually means the choice has been to shut down the company, and auction the bits off, or find a buyer for the distressed assets and then wind down the rest of the organization that doesn’t go with the assets.

I am not sure precisely what happened here, but its not looking that great of an exit for a startup.

Specifically, Star-P was effectively a cross platform tool. Our partners, Tsunamic Technologies have a Star P on demand service, running on a Linxu cluster. I think it is highly unlikely that Microsoft will continue the development of the Linux toolbase. The acquisition of assets gives them an easy way to avoid having to worry about that conversation.

In fact, this article does confirm this direction:

Microsoft says it will not continue developing Star-P (ISC???s flagship product) beyond version 2.8 which was released earlier this year, and that version 2.9 that was released to a few customers in Beta will not be released for production use by customers. Active Star-P customers who are using earlier versions of Star P were granted the right to upgrade to 2.8 by ISC prior to the close of the transaction.

But thats not all …

Microsoft did not acquire the customer contracts between ISC and their customers but says it will provide technical support to active customers through the longer of their existing support contracts or 12/31/2010.

This suggests my thesis of them splitting the company assets and liabilities, shuttering one aspect, and absorbing another. The Partners page confirms this:

3. How does this acquisition impact my current ISC Partnership (contract, alliance management, etc.)?

Since Microsoft has not acquired ISC???s partner contracts – but has acquired technology assets – your existing ISC alliance management relationships and contracts remain with ISC.

But … the Interactive Supercomputing website now redirects to a Microsoft site, with a discussion of the “transition”.

More to the point

2. How will support for ISC customers be impacted

* Customers will get a new support phone number, email and URL to access support but support should not materially change.

3. Who does the ISC customer need to contact for customer service and support?

* Notice of the new phone, email and URL has been sent to customers.

John was right about the deadpool, but possibly for a different reason than I think he intended. Yes they are gone, but a technology available in market, which was/is valuable cross platforms, is being removed from the market. Sure, you can argue that its going into future Microsoft products, but you have to ask yourself … how is this a win for high performance computing users, the (vast) majority of which are not windows HPC users?

John opined that Rapidmind should also join the deadpool. I am not so sure of this. You can still buy Rapidmind, their website is not gone, and their customer contracts will be honored. Nothing was removed from the market.

Cilk Arts is also not a deadpool candidate. For the same reasons as Rapidmind isn’t IMO. You can still buy it, it is still available, and the team is still working on it.

One could easily argue (and I think I did in the past) the the Lustre/CFS acquisition, being an asset acquisition, was not good news for CFS. They were (to a degree) in the deadpool … as much as an open source tool, and company around it, can be in the deadpool.

To Rosario C (former colleage from SGI days), David, and the rest of the crew at Interactive Supercomputing … I hope this works out well, I am sad to see the product removed from the market.

There is no doubt that this is a tough economy, and companies with good products are running out of cash while investors hedge bets, or hold back on subsequent rounds. I’d bet a reasonable beverage at SC09, that this is approximately what happened … sort of a software version of a SiCortex, though Microsoft acted before the company shuttered to guarantee others didn’t get the technology at auction.

Note: and this is important … I am not impuning Microsoft’s motives … they saw a technology and grabbed it. I am pointing out that it would be hard to classify this as a win for the investors, employees, and customers of Interactive. Probably a loss for the investors, and a draw for most of the employees. A definite loss for the customers. Especially if they built a business or process dependency around a closed source tool, that suddenly vanished, without a reasonable alternative.

Anyone wanna bet that Microsoft is looking at Mathworks closely? Though Mathworks would command a considerable sum.

Yeah, I’d call it (Interactive Supercomputing) a deadpool candidate. I’m not happy about another HPC company shutting its doors.

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