Yahoo has invested considerable resources into Apache Hadoop over the past several years. And now it is considering spinning out the engineering group responsible for the data analysis software into a separate company that it believes has the potential to be a $1 billion business.
Hadoop is the open source distributed data technology that is now used by Web companies and increasingly by enterprise providers. It’s an analytics and optimization tool that Yahoo uses to personalize content and optimize advertising.
We’ve been covering Yahoo’s deepening interest in Hadoop over the past year. The latest development came last week when Yahoo joined the Linux Foundation. It was another signal of its focus on Hadoop and its further commitment to the data analytics technology.
According to the Wall Street Journal, Hadoop would spin out the engineering group to form a separate business. Yahoo would not comment on the news but there have been discussions with Benchmark Capital, a Silicon Valley venture-capital firm about forming a Hadoop company. A partner at Benchmark sees the opportunity as one of the biggest that has been seen in the enterprise software world in quite some time.
Yahoo would be entering an already competitive market. Cloudera is one of the most well-known startups competing in the space that markets services related to Hadoop. IBM has also invested heavily in the technology.
Hadoop is one of those technologies that has value to any organization with lots of data and a Web presence. It should be no surprise that companies are adopting it. What is fascinating is seeing yahoo’s evolution from an advertising company to one that sees services as an important aspect of its offerings.
