Brocade: SDN is a Land Grab
With Brocade income on the rise, execs talk SDN strategy, have a few choice words about Cisco.
Brocade announced its first quarter fiscal 2014 results late Thursday, showing some positive momentum for profitability.
For the quarter, Brocade reported $565 million in revenue, a decline of 4 percent year-over-year. Net income was reported at $81 million, which stands in sharp contrast with the $21 million net loss that Brocade reported for the first quarter of 2013.
Looking at Brocade's business from a product mix perspective, the SAN storage business reported first quarter 2014 revenue of $412 million, down one percent year-over-year. Brocade's IP networking business reported revenue of $153 million, down 11 percent year-over-year.
"Our first quarter is a seasonally down quarter due to the fact that our U.S. federal customers placed more of their orders during the fiscal third and fourth quarter," Dan Fairfax, CFO of Brocade, said during his company's earnings call.
In September of 2013, Brocade announced its new Vyatta vRouter 5600 as a virtual routing technology. During the earnings call, Ken Cheng, CTO and VP of Corporate Development at Brocade, said that the the vRouter 5600 is out for a few trials in many of the Tier 1 carriers and service providers.
"Over the long term, we are really going to focus on addressing infrastructure virtualization needs of the carriers," Cheng said. "We are going to provide a true Vyatta platform, integrated services in addition to virtual routing capability and also leverage Vyatta to address edge consolidation such as in the enterprises as well as in the federal space."
Overall, Brocade's SDN strategy right now isn't about how much to charge customers. Lloyd Carney, Brocade's CEO, said during the earnings call that the goal is to get Brocade's SDN technology into as many potential users' hands as possible.
"I rarely ever see an opportunity for SDN that doesn’t include our routers or our fabric," Carney said. "It really is a key enabler for us, and that’s why the focus really is on the land grab, because people start looking at this."
Carney added that Brocade has a pricing model and the pricing model shows that from a performance standpoint and price performance, Brocade exceeds everybody else in that marketplace.
"But the focus is land grab, land grab, land grab," Carney emphasized.
There is no vendor larger or more influential in the networking space than Cisco. Cisco recently announced its Application Centric Infrastructure (ACI) effort, which Brocade doesn't consider a real competitive threat.
"It’s a fully integrated, locked-in solution that has proprietary aspects to it," Jason Nolet, VP, Data Center Networking at Brocade, said of Cisco ACI during the earnings call.
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Sean Michael Kerner is a senior editor at Enterprise Networking Planet and InternetNews.com. Follow him on Twitter @TechJournalist.