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Loudcloud Reincarnated as Opsware

Marc Andreessen's Loudcloud is no more. Long live Opsware.

Electronic Data Systems Corp. officially took over Loudcloud's name and managed services division Thursday leaving Andreessen and 100 employees to change the remaining business's name to Opsware Inc.

"I'm a pragmatist. I think this makes a lot of sense," Andreessen told Reuters. "Our baby is the company, and this puts the company in a much better position."

Andreessen said the new name distinguishes the company as an enterprise software company focused on Opsware IT automation software. The company's ticker symbol also changes from LDCL to OPSW .

Ironically, the Sunnyvale, Calif.-based company's first major account is with EDS, which has also signed a 3-year licensing agreement for Opsware Inc.'s IT automation software to power its data centers. The company reportedly has four more contracts waiting in the pipeline.

"The EDS licensing agreement is a great example of Opsware's ability to meet the need for IT automation to drive down costs," said Opsware co-founder and CEO Ben Horowitz. "We are pleased to start Opsware Inc with solid technology and market-need validation from EDS and other Fortune 500 customers, a two-year market lead in developing of our IT automation software, and an excellent opportunity ahead of us."

After a fairly quiet IPO, Loudcloud had struggled to find its footing in an increasingly brutal market for IT services. In its recent first quarter, Loudcloud lost $30.4 million on $11.7 million in revenues. With $94 million in cash and a quarterly burn rate of $18 million to $20 million.

The company thought it found a white knight last August, when it signed a partnership deal with Qwest Communications. However, Qwest has been roiled by accounting probes and battered with the pronounced telecom slump.

Now, Opsware is targeting enterprise customers, government agencies and service providers who can utilize Opsware's automation capabilities to improve operations quality and reduce operations costs.

"I think, in a different environment, Loudcloud would have worked great," Andreessen said. "I don't think there's any software company that was founded in 1999 that's in the position we're in right now."