Menu
Brocade exits network adapter business

Brocade exits network adapter business

Brocade late last week said it has sold its network adapter business to QLogic to better focus on data center fabrics and software defined networking.

Brocade had included the expected impact of this transaction in the two-year non-GAAP financial model presented at its September analyst day. At that time, Brocade said it would be exiting certain lines of businesses that generate approximately $80 million to $100 million in annual revenue; the adapter business is a part of that revenue total.

At the same time, Brocade laid off 300 workers to hone its focus on SDNs.

+MORE ON NETWORK WORLD: Brocade stocks fabric and net virtualization arsenal to better battle Cisco +

This divestiture includes the entire Brocade network adapter line:

" Brocade 1860 Fabric Adapters;" 815/825 and 415/425 Fibre Channel Host Bus Adapters;" 1010/1020 Converged Network Adapters;" HBA and CNA mezzanine adapters for select OEM partners.

Brocade and QLogic did not disclose the financial terms of the sale, citing non-materiality for either company's business. Brocade also did not disclose the annual revenue of its adapter business but said it was "relatively small." QLogic and Emulex are the leading storage area network adapter companies in the market.

According to Dell'Oro Group, the Fibre Channel SAN adapter business is in decline, impacted by Fibre-Channel-over-Ethernet and Cisco's FCoE-equipped UCS blade server systems, as well as softness in the high-end server market due to outsourced IT and virtualization. Fibre Channel adapter revenue was only $133 million in the third quarter of 2013, with standalone adapter revenue realizing year-over-year declines in eight out of the last nine quarters, according to Dell'Oro.

Brocade and QLogic will collaborate on the development of the next generation Gen 6 Fibre Channel technology, and build up its partnership efforts around Fibre Channel, Brocade stated in its announcement of the divestiture. Brocade said "a small number" of Brocade employees will be given offers to join QLogic but the company is not disclosing the actual number.

"This transaction continues the execution of our business strategy, which will further enable Brocade to focus on core networking technologies in the data center in order to better serve our customers and partners and to drive better value for our shareholders," said Ken Cheng, CTO and vice president of Corporate Development and Emerging Business at Brocade, in a statement. "This transaction also benefits our customers through the two companies firmly committing to the success of the current Gen 5 Fibre Channel technology as well as Gen 6 technology, which is now in development."

Brocade said it will provide an update during its first quarter fiscal year 2014 earnings call in February.

Jim Duffy has been covering technology for over 27 years, 22 at Network World. He also writes The Cisco Connection blog and can be reached on Twitter @Jim_Duffy.

Read more about data center in Network World's Data Center section.


Follow Us

Join the New Zealand Reseller News newsletter!

Error: Please check your email address.

Tags Configuration / maintenanceSDNQLogichardware systemsData CenterLAN & WAN

Featured

Slideshows

Tight lines as Hooked on Lenovo catches up at Great Barrier Island

Tight lines as Hooked on Lenovo catches up at Great Barrier Island

​Ingram Micro’s Hooked on Lenovo incentive programme recently rewarded 28 of New Zealand's top performing resellers with a full-on fishing trip at Great Barrier Island for the third year​ in a row.

Tight lines as Hooked on Lenovo catches up at Great Barrier Island
Inside the AWS Summit in Sydney

Inside the AWS Summit in Sydney

As the dust settles on the 2017 AWS Summit in Sydney, ARN looks back an action packed two-day event, covering global keynote presentations, 80 breakout sessions on the latest technology solutions, and channel focused tracks involving local cloud stories and insights.

Inside the AWS Summit in Sydney
Channel tees off on the North Shore as Ingram Micro hosts annual Cure Kids Charity golf day

Channel tees off on the North Shore as Ingram Micro hosts annual Cure Kids Charity golf day

Ingram Micro hosted its third annual Cure Kids Charity Golf Tournament at the North Shore Golf Club in Auckland. In total, 131 resellers, vendors and Ingram Micro suppliers enjoyed a round of golf consisting of challenges on each of the 18 sponsored holes, with Team Philips taking out the top honours.

Channel tees off on the North Shore as Ingram Micro hosts annual Cure Kids Charity golf day
Show Comments