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IBM has snapped up data streaming company Confluent in a $11 billion deal.
Confluent provides an open source data-streaming platform which, IBM says, “connects, processes and governs reusable and reliable data and events in real time, foundational for the deployment of AI”.
Confluent, which uses the open-source data-streaming platform Apache Kafka, sells its products across various cloud setups: a fully managed cloud-native offering available on the likes of AWS and Azure; self-managed for on-premises or private cloud deployments; as well as bring-your-own cloud versions. Confluent also offers over 100 connectors to enable companies to feed data from sources, including data lakes and warehouses, or SaaS apps, into Kafka. Companies can bring their own custom connectors too.
IBM says the California-based company has over 6,500 customers, including travel site Expedia, tyre company Michelin and investment bank Morgan Stanley.
The deal is expected to close in the middle of next year, pending regulatory approvals. Confluent will operate as separate brand within IBM once the acquisition is complete.
According to IBM, its acquisition of Confluent will tie in with its own data and automation strategies.
“IBM and Confluent will enable end-to-end integration of applications, analytics, data systems and AI agents to drive intelligence and resilience in hybrid cloud environments,” IBM said. IBM hopes that its offerings, alongside Confluent’s, can be pitched as a way to help businesses rolling out generative and agentic AI.
According to analyst house Gartner, global spending on generative AI is expected to top $644 billion this year, an increase of over 75% compared to 2024.
However, the researchers have warned that GenAI projects often fail to live up to expectations, as proof of concept projects have delivered “high failure rates”. As a result, it believes CIOs will shift spending away from homegrown GenAI tools and increase investment in existing products from established vendors.
The picture for agentic AI is just as mixed. Gartner projects that 15% of day-to-day business decisions will be made by autonomous agents by 2028, yet 40% of agentic AI projects will be cancelled by 2027 as business find their early rollouts have failed to deliver.
Again, instead of concentrating on homegrown AI agents, they are expected to up their spend with vendors’ own offerings.
