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Brocade expands battlefield with Cisco to encompass Data Center Ethernet and FCoE

Brocade executives say the company is looking to take market share from Cisco Systems in Data Center Ethernet and Fibre Channel as enterprise data center networks merge.

BOSTON – Brocade Communications Systems Inc. officials laid out their roadmap for taking market share from chief rival Cisco Systems Inc. at their analyst day Tuesday, with an emphasis on making gains in Data Center Ethernet networks in addition to Fibre Channel (FC) and Fibre Channel over Ethernet (FCoE) as data center networks converge.

According to a presentation by chief financial officer Richard Deranleau, Brocade aims to maintain its FC storage-area network (SAN) market share over the next three years. The most recent Dell'Oro Group market share numbers put Brocade's share at 75.5% of the market. But following its acquisition of Ethernet equipment maker Foundry Networks Inc. last year, it's also looking to take an additional 4% share of the Cisco-dominated Ethernet market, Deranleau said, which would make Brocade's Ethernet revenue goals equal to its Fibre Channel revenue projections at $1.9 billion apiece by 2012.

Executives said their strategy for doing battle with Cisco in the Ethernet market rides on the strength of the company's OEM and channel partner relationships with large IT vendors, including Dell Inc., Hewlett-Packard (HP) Co. and IBM. They're also banking on a wave of network redesigns hitting corporate data centers as 10 Gigabit Ethernet (10 GbE) and Data Center Ethernet reach maturity. Brocade CEO Michael Klayko said a recent survey of Brocade's customers showed 70% expect a significant upgrade of their Ethernet networks within three years.

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"There are an enormous number of opportunities for us with this transition," Klayko said.

The company has been internally reorganized to share intellectual property between Ethernet and Fibre Channel engineering groups. Sales reps are no longer divided into separate local-area network (LAN) and SAN groups, though there are technical specialists being made available for specific support if required.

Meanwhile, LAN and SAN remain separate animals in most customer environments. According to Michael Biedermann, systems analyst at the University of New Mexico Hospital, decisions about the IP network and SAN are made separately, with the IP network group remaining loyal to Cisco and the SAN group running Brocade for Fibre Channel. Over the last six months, the two groups have taken a look at their respective vendors' other products, but elected to stay where they were for now.

"I think it may just be familiarity," Biedermann said. His team contemplated going with an iSCSI SAN as well, but "it wasn't so much the vendors we were concerned about but our own network. We didn't want to tax it any more with storage on it."

As for whether Brocade's newly expanded focus might become a distraction, Biedermann said, "I would rather deal with a Fibre Channel switch company trying to break into Ethernet than an Ethernet company trying to break into Fibre Channel."

Analyst Day attendee Rajesh Ghai, vice president of equity research at San Francisco-based ThinkEquity LLC, said the 4% market share gain and revenue goals are ambitious, but not unattainable for Brocade.

"Their model is mostly indirect, so they don't have to invest as much in direct sales and marketing to go into new markets," he said. "It all comes down to the OEMs. Can they step up and tell customers Brocade is also their preferred Ethernet provider?"

Brocade pulls together FC and Ethernet management

Brocade also made a bundle of Ethernet-related product announcements in anticipation of Analyst Day. Data Center Fabric Manager (DCFM) 10.3 can now be used to centrally manage all of Brocade's Fibre Channel, Fibre Channel over IP (FCIP), FCoE and Ethernet switches, as well as virtual server traffic at the host level (this last feature was announced prior to VMworld 2009).

New FCIP SAN extension products support a 10 GbE connection over the wide-area network (WAN), port trunking with lossless failover and new QoS features. Previously, Brocade had several different offerings for FCIP, including the FR4-18i Director Blade, the Brocade Edge M3000 Storage Router, the USD-X switch, and the 7500 and 7500e fixed edge switches. The new 7800 series switches and FX8-24 DCX director blade will replace the M300, USD-X and 7500/e products, though the FR4-18i blade will remain available for the 48000 director. HP has already begun rebranding the new FCIP products.

The new FCIP products now offer dual paths over the WAN to aggregate bandwidth, and shift packets without data loss should one link fail. If one redundant 7800 switch or blade fails, the other will take over sending data at maximum bandwidth, according to Truls Myklebust, Brocade's senior director of product marketing.

"In the previous generation, you could configure individual tunnels over one connection, but if it was lost, there would be an interruption," Myklebust said. "The 7500 series was selling well in the midrange, but in the high-end and mainframe world they have very high expectations for availability and resiliency."

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