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Hortonworks Names Analyst Marshall VP of Development

How a new hire hints at an unfolding strategy.

John Michael, Evan Potter/Shutterstock

Big data startup Hortonworks just announced an interesting hire. The company says it has tapped Brian Marshall, a analyst with the researcher firm ISI, as its VP of corporate development. The hire was announced in a company blog post.

Marshall spent the last 15 years or so as an analyst covering tech companies. He joined ISI in 2011, and prior to that was an analyst covering IT hardware companies at Gleacher and at Jeffries before that. I’ve often quoted from his research notes myself. (Here he is talking about Apple shares in an appearance on CNBC earlier this year.)

Hortonworks is one of the players in the white-hot world of Hadoop, the open source technology that makes it easier for businesses to work with large collections of data in order to learn something useful from it. (Hadoops’s logo is of a cartoon elephant, hence the pic of the real elephants above.) Earlier this year the company attracted a $100 million investment in a round led by BlackRock, and a $50 million strategic investment by Hewlett-Packard.

Marshall’s job (that’s him at right) will focus on helping the company deliver on what it calls “core capabilities,” in building up its business of helping companies deploy and use Hadoop.

About Marshall, Hortonworks VP for corporate strategy Shaun Connolly wrote: “We are bullish about how Brian can not only contribute to our mission to establish Hadoop as the foundational technology of the modern enterprise data architecture but also help accelerate and scale our efforts towards delivering all of the necessary capabilities,” for its Hadoop business.

Incidentally, Marshall is leaving ISI just as that company has agreed to sell itself to the investment firm Evercore Partners in a deal worth more than $400 million announced earlier this month.

Marshall’s role may indicate more acquisitions are coming from Hortonworks. In May, Hortonworks acquired XA Secure, a company that specializes in securing Hadoop.

But here’s an interesting thing about that deal that should get Hortonworks’ numerous competitors like Cloudera, EMC’s Pivotal, and MapR a little worried: After buying XA Secure, Hortonworks turned its technology loose as open source software, meaning anyone can use it. Earlier this month, it became known as Apache Argus.

Why give it away for free? One big part of the Hortonworks play is to repeat what it did with XA Secure and therefore eat away at the competitive opportunity for other Hadoop players to create proprietary services they can charge for. Adding more software designed to run in combination with Hadoop that costs nothing to obtain will in theory hurt the opportunity for other companies to create and sell their own specialized software intended to do the same thing.

Remember that Hadoop itself is open source software, and therefore free to download and install. That doesn’t meant it’s easy to run. The basic business opportunities around it are to tweak it and fine-tune it for running in an enterprise, as Cloudera has done, or to create additional software and services that help companies run it.

Hortonworks’ approach is to rely purely on open source software, and then help companies get it running and keep it running. If that sounds at all familiar, you may be thinking of Red Hat, the company that built a $1.5 billion annual business around Linux, the open source operating system that runs on most Internet servers, and which is a Hortonworks partner.

Hadoop has so far this year managed to attract nearly $1.2 billion in investments. On top of the $150 million poured into Hortonworks, chip giant Intel led a $900 million round in Cloudera in March, giving it a stake worth about 18 percent of the company. In June, MapR landed $110 million in a round led by Google Capital.

Hadoop sprang out of Yahoo, but was inspired in part by work at Google on a technology known as Map Reduce. The core team from Yahoo that created Hadoop went on to start Hortonworks.

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