IBM to buy data firm for $1.7 billion

Cloud storage companies are increasingly attractive acquisition targets for larger firms making the transition from hardware and software to services. According to a statement, in the last four years IBM has invested more than $12 billion in 23 analytics-related acquisitions. IBM's analytics business grew 14 percent in the second quarter of 2010.

"The addition of Netezza will reinforce IBM's focus in understanding clients' needs by providing them a broader set of analytics capabilities and bringing the power of analytics right into the hands of business users at every level within an organization," said Arvind Krishna, general manager for information management at IBM.

The deal is subject to shareholder approval and regulatory clearance; IBM expects it to close in the fourth quarter of this year.