It appears that Intel has bought the client hypervisor vendor Neocleus. This is according to a blog post from September 3 by Neocleus' Chad Jones. In a weird twist, the blog post has since been removed, although the Google still has it in its cache.
From Chad's post:
Neocleus has been acquired by Intel Corporation! This is an exciting development for the employees and management team of Neocleus. The power of the industry’s leading client hypervisor combined with the #1 platform manufacturer will inevitably lead to a tremendous evolution in client computing and management.
This acquisition is the culmination of more than a year’s worth of hard work and tough choices which saw the addition of a seasoned US management team (and an HQ move to Cambridge, MA), followed by the evolution of the Neocleus vision, the re-launch of the company, the signing of the industry’s first OEM agreement with BigFix (acquired by IBM), and, finally, the acquisition of Neocleus by Intel. Along the way, the development team went above and beyond in solving incredibly difficult technological conundrums to ensure that the Neocleus platform was innovative and met the market needs.
This has truly been a fantastic year and the future looks bright indeed! Keep your eye on Intel and the subsequent developments that follow as they are sure to be exciting!
Israel-based Globes Online (Neocleus is an Israeli company) is reporting that Neocleus was out of money and that Intel bought them for only a few hundred thousand dollars despite having received $22 million in investment from Battery Ventures and Gemini Israel Funds. Neocleus (or their funders) have been shopping themselves around looking for a buyer for a few months now... I've had more than one conversation with people who were approached but all felt that Neocleus didn't really have enough technology to warrant the prices they were looking for.
Now it appears that they were on the verge of shutting down completely, hence the reported sub-$1m price tag. So far there's no official word from Intel or Neocleus even acknowledging that this deal has happened, and none of my contacts at either company have responded to any requests for comment. [UPDATE: Here's what I got back from my Intel PR contact: "Intel purchased client virtualization software, intellectual property and hired key software development individuals. These assets will strengthen Intel's desktop virtualization capabilities, and further business client use-case development and innovation. We're currently integrating these capabilities into our roadmap and working on enabling plans for OEMs and ISVs."]
What will Intel do with Neocleus?
From a strategy standpoint, the price was so cheap that Intel can really "treat this like a recruiting fee to get fifteen good engineers for their Haifa R&D facility," said one source I talked to.
But having a client hypervisor isn't the worst thing in the world for Intel. Some folks are saying that Citrix was giving Intel a lot of pressure about their XenClient vPro requirement. (Intel gave Citrix a lot of money to ensure that XenClient 1.0 would require vPro, but now Citrix is finding that a bit limiting as people are starting to question why since there's no hard technical reason for it (as Virtual Computer and MokaFive have demonstrated). So you can imagine Citrix going to Intel to pressure them to lay-off the vPro requirement, and now with Neocleus Intel can fight back and say, "Hey, if you don't play by our rules, then we're going to F you and release our own hypervisor."
Melodrama aside, now that Intel has some IP around a client hypervisor there's probably a lot of cool stuff they can do. Imagine combining a McAfee security VM with a client hypervisor that's pre-installed right out of the box? (Or running via a microkernel on firmware?) Maybe Gabe's vision of no add-on software hypervisor will come true? Either way, we're probably looking several years down the road, but it's clear that client hypervisors are going to be pretty big.
What do you think? What should Intel do with Neocleus?