Brocade is already the top player by market share in the modular SAN switch market, ahead of second-place Cisco. Acquiring Foundry and its switching and routing technology has given Brocade a strong foothold in the enterprise LAN and service provider markets.
Following its McData acquisition, Brocade has garnered around 80% market share in the SAN switch market. “Foundry acquisition will catapult us into the big league. We are talking about US$20 billion addressable IP market as opposed to around US$2 billion SAN connectivity market. Though the IP space is new for Brocade, our goal is to provide robust, cost-effective alternatives to Cisco in the switching and routing market for enterprises and service providers,” says Khalid Khalil, Brocade’s Sales Manager for MEA.
Industry pundits say as Brocade Communications has been leading in the modular SAN switch market, its entry into the IP space will not only offer an alternative to Cisco’s offerings but also broaden IP offerings for clients in this market. By moving into Cisco’s networking market and enhancing its offerings with the recent acquisition of Foundry Networks, Brocade Communications has taken on Cisco head on and is doing what many SAN switch vendors have tried to do but with little or no dent on Cisco’s dominance in the IP space.
Tech roadmap
Khalil says the two companies’ technologies are complementary, he says. Foundry will bring Brocade an Ethernet portfolio for LANs, complementing its Fibre Channel SAN technology. But the purchase wasn’t made to help Brocade tackle the emergence of Ethernet in storage networks. Brocade was already working toward that with "lossless Ethernet" technology that gives Ethernet the deterministic quality required in SANs, he adds. The company has already developed its own silicon for this emerging technology and put it in the DCX Backbone multiprotocol storage switch, which will support the future Fibre Channel over Ethernet (FCoE) standard, according to Khalil.
The company has not yet detailed how it will integrate Foundry’s ‘Iron’ switches and routers. It did say, however, that the buy would not result in downsizing at either Brocade or Foundry. “Though Foundry will cease to exist, we are not planning to change the product brand names after assimilation into our fold,” says Khalil.
In addition, he points out that at the top level product integration has already started but because of the prevailing conditions, the company will not rush to integrate all the Foundry products with the existing Brocade array.
It’s a smart move for Brocade who typically would compete with Cisco in the FCoE market. Cisco, who has dominated Ethernet forever, may face increasing pressure from storage networking buyers who are considering FCoE and the converged network. Hesitant to switch to Cisco, these buyers will now be able to rely on Brocade to supply their Fibre Channel/Ethernet needs.
Brocade, which dominates the Fibre Channel market, will now have an additional entry into FCoE with Foundry’s Ethernet switches and routers combined with its own Fibre Channel and storage-savvy products.
Khalil also highlighted the future of Fibre Channel over Ethernet, an emerging technology that lets the Fibre Channel storage protocol take advantage of 10Gigabit Ethernet networks.
Brocade is ready to release FCoE products but doesn’t believe there is enough demand, he says. The primary benefit of FCoE is the consolidation of cables and adapters, but that can also be achieved simply by using blade servers, Khalil says.
“There is a lot of hype around FCoE. What people don’t realise is that the technology doesn’t work on Ethernet as we know it today. What it requires is converged enhanced Ethernet, which is yet to be standardises. "I don’t think [FCoE] is going to be big in 2009. I think we could see some adoption in the back half of 2010," he adds. Brocade has publicly discussed its FCoE road map but is holding back on releasing a comprehensive product.
The more intriguing implications of the union will be to the rest of the Ethernet switching market. Cisco’s 70%-plus market share dwarfs that of other players – Nortel, HP ProCurve, Force10 Networks, Extreme Networks, Enterasys Networks and new entrant Juniper Networks, among them. This deal leaves them further behind, observers note.
The Foundry bonus
Industry pundits believe the merger between Brocade and Foundry gives Brocade the best ammunition to take direct aim at Cisco. Cisco on the other hand has been exploring ways on how best it can enter the data centre and compete directly with its OEM partners.
And though Foundry was one of the Ethernet switching companies fighting an uphill battle against Cisco for market share, Brocade picked the best of the lot, according to industry analysts. A bonus for Brocade, they say, is the technology depth for future product innovation and Foundry’s presence, albeit tiny, in service provider routing.
Also, Brocade is better able than Cisco to cooperate with key system vendors such as IBM, HP and EMC because of its deep, long time relationships with those companies. But with Cisco having hinted that it would like to enter the mainstream server market, pundits believe Brocade’s relationship with the likes of IBM, HP and EMC will be strengthened further.
Industry pundits view Cisco’s entry into the server market, which could revolve around adding server blades to its switches, as putting the company in direct competition against many of its key system vendor partners.
These server vendors namely HP, IBM, Dell, Sun and other OEM server vendors have for a long time served as Cisco’s primary go-to-market channel for its networking and SAN kit.
Interoperability
The issue of interoperability is always a thorny one for enterprise organisations especially those that have heterogeneous IT platforms. For Brocade, having products that are interoperable with other vendor solutions will stand the vendor in good stead.
Interoperability with other vendors’ products will be critical as enterprises ease into transformations of their data centres. We already have an OEM agreement with IBM and are talking to other system vendors. Recent moves by Cisco, including continued rumours of the vendor’s fray into the blade server market, pit it against the system vendors it uses as its go-to-market channel, he said. Cisco has been pushing to put more of the intelligence of data centres in the network infrastructure. “We say it’s all about day while Cisco reckons its all about the network,” concludes Khalil.
With the acquisition of Foundry Networks having closed on December 19 last year, Brocade Communications is aiming to become Cisco’s chief competitor for customers throughout the data centre after this purchase.
