Silver Peak Systems Inc., which scored a $21 million funding round last month, has received another boost by forging a reseller deal with EMC Corp.
EMC will resell the Silver Peak NX-5000, NX-7000 and NX-8000 – devices that accelerate traffic in large offices and data centers. However, EMC will not resell Silver Peak's appliances for branch offices.
EMC sells products on its Select list with its hardware and software offerings, as well as services. Unlike OEM deals, EMC does not rebrand Select products, but coordinates customer support with its partners.
The deal is a big score for Silver Peak, which is among the smallest of the vendors in the WAFS marketplace, which includes market leader Riverbed Technology Inc., Cisco Systems Inc., Citrix Systems Inc., Juniper Networks Inc., Packeteer Inc., BlueCoat Systems Inc., F5, NetEx and Expand Networks Inc. Of that roster, only Silver Peak, Expand Networks and NetEx are private companies.
Why did EMC pick Silver Peak for its reseller program? According to Forrester Research analyst Rob Whiteley, it's because Silver Peak excels at distance replication, making it a good fit for EMC's SRDF application. which handles remote replication for Symmetrix high-end storage arrays. The idea is for Silver Peak appliances to sufficiently optimize WAN traffic to prevent dropped packets, driving sales of SRDF licenses to organizations looking to replicate between sites.
"Distance replication is the killer application," Whiteley said. "It quickly comes down to a handful of vendors that do that well. Silver Peak, Riverbed and F5 handle replication from a raw acceleration perspective, and then it comes down to scalability. Silver Peak comes out as the most scalable, so it's no surprise they would gravitate toward a program like EMC's."
Silver Peak executives are obviously looking for a big sales bump from the deal. In a 2007 Forrester report on WAN optimization, Whiteley rated Silver Peak products the highest, but put the company's strategy and market presence at the bottom, ranking the company last in financial resources to support its sales strategy and channel partners.
Silver Peak director of product marketing Jeff Aaron said his company has "several hundreds" of customers. He expects the EMC deal to accelerate sales, although he said Silver Peak will continue to build its channel. "This will help drive business, but we won't put all our eggs in that basket," he said. "It helps give us a global presence."
Still, Silver Peak faces a tough road. Riverbed reported 126% year-over-year revenue increase last quarter and competitors like Cisco and Juniper have vast resources to build their WAN acceleration products. But the EMC deal allows Silver Peak to play to its strength. In his 2007 report, Whiteley recommended Silver Peak for organizations that can't wait for other vendors to scale their products to 500 Mbps of optimized WAN traffic.