Thread by @hyounpark

$AVGO makes a big bet on @CAinc to build integrated digital solutions that combine chip, connectivity, and software. At the very least, there should be more embedded APIs & services as well as joint solutions development coming out of this.

https://twitter.com/CNBCnow/status/1017138127666925569

@CAInc has traditionally been strong in #DevOps, #API Management, & #ITOps: the management layer focused on processor, network, & IT SLA performance. Now, Broadcom has a wide range of software tools to track the monitoring and usage of its hardware.

I'll be interested in seeing how @CAInc's Internet of Things & mobile app dev departments expand once $AVGO completes this transaction as well. Getting CAs dev tools closer to silicon can only help performance and help $AVGO to provide out-of-the-box IoT solutions

$AVGO also gets access to CA's still considerable mainframe business and the ability to potentially upsell or replace those workloads over time with Broadcom computing. Grab enterprise computing workloads at the source and then custom build to their needs.

But from a traditional OSI perspective, this acquisition feels odd because Broadcom is skipping multiple layers between its core competency and CA's core competency. Is this also a bet that 5G, LoRaWAN, & other connectivity will close the gaps?

There's a hyperscale private cloud play here as well for $AVGO, bringing Broadcom's data center networking business together with CA's server management capabilities.

So, between mobile chip/app, industrial #IoT, data center & private cloud, & mainframe markets, there are a number of adjacencies between Broadcom $AVGO & @CAInc. But it will be challenging to knit together all of these pieces accretively.

All this being said, this is still very much an acquisition out of left field. I'll be fascinated in seeing how this transaction ends up. I think it's a very complex puzzle. But there is some alignment here.

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