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Chipmaker Broadcom To Buy Network Gear Maker Brocade For $5.5 Billion (reuters.com)
An anonymous reader quotes a report from Reuters: Chipmaker Broadcom Ltd said it would buy Brocade Communications Systems Inc for $5.5 billion, pushing deeper into the fast-growing market for network equipment used in data centers. The deal, the latest in a consolidating chip sector, will allow Broadcom to corner a larger share of the data center products market by using Brocade's fiber channel switches that speed up data transfer between servers and storage devices. Singapore-based Broadcom, formerly Avago Technologies, is known for its connectivity chips used in products ranging from mobiles to servers, while California-based Brocade makes networking switches, software and storage products. Broadcom said it planned to sell Brocade's networking business, which makes controllers and access points that help businesses offer high-speed internet to their customers, to avoid competing with its top customers such as Cisco Systems Inc.
When Cisco closed down their European R&D centres in Edinburgh & Reading, Brocade came in and picked up the redundant developers.
Cisco has lost interest in R&D and has positioned itself as a solutions provider following much the same evolution as IBM.
Buying back what they threw away just doesn't make sense given their lack of interest in selling boxes.
I know all this because I setup Cisco's R&D in Edinburgh when Shiva Networks closed down their acquisition Spider Systems.
My friends working at Brocade are, understandably, very concerned about this acquisition.
They are part of a core group of highly experienced (25+ years) network equipment developers who have never changed jobs other than when they've been acquired or laid off. (Spider->Shiva->Cisco->Brocade)
There's little chance another Brocade will come and save them a 4th time as the network industry has matured to a point where routers and switches are now commodities and if anyone is still developing them they aren't in the UK.