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Brocade grabs Foundry Networks, challenges Cisco in the data center

There’s one vendor out there who is poised to challenge Cisco Systems’ dominance in the data center networking market. No, it’s not Juniper with its new line of EX switches. ProCurve Networking by HP is strong, but it doesn’t have the high-end core switches that Cisco can now boast with its Nexus family of switches.

No, the real challenger to Cisco might just be a storage networking vendor: Brocade.

Brocade announced Monday night that it has reached an agreement to buy Foundry Networks for $3 billion. The new company formed by this merger will feature Brocade’s industry leading storage networking technology and Foundry’s line of high-end service provider and enterprise class data center network switching technologies.

Brocade had already signaled its intention to challenge Cisco in the data center when it unveiled its new DCX Backbone switch last January. This chassis-based switch supports 8 Gbps Fibre Channel and emerging converged Ethernet technology. Also known as data center Ethernet, converged Ethernet holds the potential to carry all forms of data center traffic on one fabric. Instead of having separate networks for storage and for servers, companies can have one unified fabric and one set of network devices to provide connectivity in their data centers. Several standards must be ratified before this technology becomes widely available to the market, but Brocade isn’t the only vendor to invest in it early. Cisco’s new Nexus switches also support converged Ethernet. Both Cisco and Brocade have signaled that this technology is the future of data center networking.

But Brocade’s expertise and breadth of offerings in Ethernet technology doesn’t extend very far beyond it’s DCX product. That’s where Foundry comes in. Established in 1996, Foundry has a reputation for building high-density core data center switches favored by very large enterprises, service providers and Internet-class companies. Foundry lists companies such as AT&T, Google, Yahoo, Apple, Discover, Citigroup, Wachovia, AOL, Ticketmaster, MorganStanley and the U.S. Internal Revenue Service as its customers.

With the Ethernet switching expertise of Foundry, Brocade now appears ready to stake out a solid number two position in the data center networking market. A lot will depend on how well Brocade absorbs Foundry. That will take some time. Cisco isn’t exactly shaking in its boots today, but it will have to stay on its toes.

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