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Brocade CEO calls Whiptail deal a mistake for Cisco

Don’t expect Brocade to follow its Fibre Channel SAN switch rival Cisco into the world of flash storage arrays.

During Brocade’s Analyst Day Wednesday, Brocade CEO Lloyd Carney said Cisco’s acquisition of all-flash array startup Whiptail was a blunder that should help Brocade increase its lead in FC switching.

“Cisco went off and bought a storage company,” Carney said. “It’s causing people in the storage business to say, ‘Should I partner with them as much as I did in the past?’ We are leveraging that to our benefit. The enemy of my enemy is my friend. They’re making enemies and we’re making friends.”

Most FC switches are sold through OEM deals with storage vendors. Brocade is counting on improved relationships with those storage vendors following Cisco’s move into flash although Cisco insists the Whiptail technology will be used with its UCS server platform rather than as a storage offering.

Brocade tried a similar strategy after it acquired Ethernet switching vendor Foundry in 2008. When Cisco moved into the server market with UCS, Brocade became a closer partner on the Ethernet side with server vendors IBM, Hewlett-Packard (HP) and Dell. The results weren’t what Brocade hoped for as HP and Dell went out and bought their own Ethernet switch companies.

Now Brocade’s main target to grow closer to is EMC, which has historically been a tighter Cisco ally and partners with Cisco in the VCE converged infrastructure alliance. Cisco sells more FC switches through EMC than Brocade does, and Carney is hoping to change that using the Whiptail deal as a catalyst. EMC sells its own XtremIO all-flash array that competes with Whiptail.

Brocade is still trying to cut into Cisco’s market share lead in Ethernet switching, but Carney made it clear that storage is its main focus. While the future of FC has been questioned, Brocade executives said developments such as flash and the cloud will increase the need for storage networking.

“We’re number one in the SAN market, and that’s what we’re known for,” Carney said. “You start worrying about Brocade when people stop buying storage.”

And while Brocade isn’t looking to get into the storage array business, Carney said this is a good time to pick up new technology through acquisitions. “Startups are overfunded with venture capitalist money and every good technology has about two or three companies you can buy,” he said. “It’s a buyer’s market now.”

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