Riverbed plots new remote office platform with software blades

Riverbed is ready to expand its Steelhead WAFS product line with software blades that add new services for remote offices.

Riverbed Technologies Inc. will launch services for remote offices this year through software blades on its Steelhead WAFS appliances, company executives said during Riverbed's earnings conference call last night.

Riverbed CEO Jerry Kennelly said the company would soon disclose the first products for the Riverbed Services Platform (RSP) -- probably later this month -- and continue to roll out new pieces down the road. The company will also name the technology partners helping Riverbed create the services.

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"We're creating a new product offering," Kennelly said. "Given where we physically sit in the network at every remote site and on remote workers' laptops, we've got a very powerful architecture position we can leverage."

Riverbed marketing vice president Eric Wolford said RSP would be part of the next upgrade to the Steelhead WAFS product line, which improves application performance to sites outside of the data center.

"We're getting lots and lots of boxes deployed, and there's a strong desire on the part of customers to consolidate more servers and more boxes into our data services box," Wolford said. "The anchor tenant that drives deployment of the box is accelerated data services. We saw we had an opportunity to open up our platform, protect it and allow software blades to be placed on Steelhead."

Wolford said the blades would fill "demand for other edge data services." These include print services, application probe, domain name system (DNS), DHCP, IP address management, streaming media, Active Directory, domain controller, unified threat management. Customers of the new service would pay Riverbed for the box and would license the software blades from its partners. "The idea is to avoid multiple blades on multiple boxes," he said.

The partners will likely come from the Riverbed Technology Alliance (RTA) partner program. CommVault Systems Inc., Double-Take Software Inc., ExaGrid Systems Inc., BlueArc Corp., Compellent Technologies, Isilon Systems Inc., Radware Ltd., Mazu Networks and Voyence Inc. are among the RTA vendors with joint development and marketing deals with Riverbed. However, Riverbed executives didn't mention any specific partners for RSP.

When an analyst asked if Microsoft would be a partner, Wolford laughed and said, "We're not here to announce anything like that, that's for sure." He did say that Riverbed wants to offer more Windows services. "We have customers looking for features, functions and facilities inside Windows, and we want to make those available."

Chasing managed services, too

Riverbed executives also said they are pursuing managed services deals, similar to a partnership struck last October between its WAFS rival Juniper Networks Inc. and Verizon Communications where Verizon uses Juniper WAN optimization for its service. Kennelly said that the Verizon-Juniper deal is not exclusive, and Riverbed does some small deals with Verizon. Wolford added that Riverbed is "aggressively pursuing" deals with managed service providers to use Steelhead devices and hopes to have some finalized late this year and 2009.

Riverbed executives claim they're not worried about renewed competition from Cisco Systems Inc., which brought out its WAAS Mobile product for laptops and desktops, and new Application Control Engine (ACE) devices last month. Kennelly said Riverbed wins about 90% of its competitive "bakeoffs" against Cisco.

Riverbed reported revenues of $76.3 million last quarter, up 126% from last year. It completed its first full year as a public company with $236 million in revenue. It recorded a profit of $4.8 million for the quarter and $14.8 million for the year.

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