Intel to ditch its Hadoop software and support Cloudera instead

Updated at 9:17 a.m. Pacific on Thursday with confirmation of the deal and clarification that Intel, not Intel Capital, made the investment.

Intel is set to cause a tremor in the big data market tomorrow.

The chip maker will announce tomorrow that it will stop pushing its own distribution of open-source Hadoop software for storing and processing lots of different kinds of data, and it will instead support the Hadoop distribution from fast-growing big data company Cloudera, VentureBeat has learned.

Simultaneously, Intel will reveal a new investment in Cloudera and become the largest investor in Cloudera, an industry source familiar with the coming news tells VentureBeat. Intel could be sinking more than $90 million into Cloudera.

Representatives of Intel and Cloudera declined to comment.

A press release confirmed the deal hours after VentureBeat’s report. “This is Intel’s single largest data center technology investment in its history,” the release said.

Cloudera announced a $160 million round of funding just last week. A week later, fellow Hadoop company Hortonworks disclosed a $100 million round of its own.

And last year, Pivotal, a company that pushes still another Hadoop distribution (among other software), received a $105 million investment from GE.

Indeed, increasingly companies are becoming interested in the scalability and open-source nature of Hadoop. Small wonder analytics software vendors that offer deep support for Hadoop have been catching on as well.

But while it might seem that selling commercial support for Hadoop software automatically translates into the kind of revenue that investors like, in fact Intel’s Hadoop distribution has not been a huge hit, at least in the United States. Intel does have strong relationships and partnerships in parts of the world where Cloudera has wanted to enter, like China. And that’s why it might make sense for Intel to ditch a product that never became a global hit and instead gain ground by pushing a more popular distribution.

Intel has been trying to do a deal of this nature with a Hadoop vendor for several months now, according to VentureBeat’s source. It approached at least one other Hadoop vendor before partnering with Cloudera, the source said.

Last week Bloomberg reported that Intel was part of a new round of funding for Cloudera. But Intel was not listed among the investors when Cloudera issued the press release for the $160 million round.