14 DAY TRIAL // Embedded systems are now a force on the computer market as they are expanding from simple circuits to more and more complex forms. At the same time, the operating systems designed for them are getting more complex too. One company that develops operating systems aimed at embedded hardware components is the 1300 person company Wind River.
According to the news site InfoWorld, the company encountered some financial difficulties lately and it looks like the big blue giant, IBM, is preparing to buy the whole company in an attempt to gain a strong foothold on the embedded systems market. Wind River develops operating systems for embedded hardware applications that are used mainly in the aerospace, defense, and automotive industries. At the base of its platform there is both an open source Linux distribution and a proprietary system, the VxWorks OS. Apart from the industry clients, Wind River has a number of customers that activate in the network infrastructure and consumer electronics domains.
The company posted losses for the first time in May last, when a figure of $2.1 million was reached and again in May 2007 when the company lost no less than $4.6 million. According to the company's executives more losses are expected, even if revenues went from $65 million to $78 million. Wind River declined to comment on the acquisition rumors and IBM spokesman Fred McNeese said "It is IBM's position not to comment on rumors and speculation. The acquisition of this company would only be the last step in a string of expanding moves undertaken by IBM in the last period and one industry observer commented that the acquisition of a Linux developing company would allow the giant manufacturer to expand its core markets. "IBM sells in other markets than just servers," said Joe Clabby, president of Clabby Analytics. "For instance, IBM sells millions of POWER chips to makers of video game consoles. IBM has probably identified several market opportunities for little, intelligent, Linux-based embedded systems."
As IBM already has an embedded systems group; the acquisition of the Wind River company may be targeted at complementing its own work force in this domain, more so since the two companies are known for close relations in the past. Enea, a rival company, said that the Wind River acquisition will allow IBM to expand its reach on the embedded systems market and to find new customers for its services.