Brocade deepens IBM ties, steps up attack on Cisco

Apr 28, 2009 By JORDAN ROBERTSON , AP Technology Writer

(AP) -- Brocade Communications Systems Inc. is deepening its ties with a powerful ally, IBM Corp., forging a new distribution deal for Internet routers and switches at a time when bigger rival Cisco Systems Inc. is straining some of its old relationships.

Brocade and IBM are set to announce Tuesday that IBM will help sell more Brocade products by re-branding them with IBM's own logo and pushing them out through IBM's sales force - a common arrangement among technology companies that gives the smaller one (Brocade) access to better distribution and the bigger one (IBM) access to products it didn't pay to manufacture.

IBM has resold Brocade products - specifically, switches that connect servers and machines - in this way for over a decade. Tuesday's announcement is an expansion of that partnership, in which IBM will resell the Internet routers and switches that Brocade picked up as part of its $3 billion acquisition last year of Foundry Networks, a small Cisco rival.

In that sense, the announcement is incremental for IBM, which as a one-stop technology shop has to play both sides of the fence when it comes to reselling competitors' products, but is major for Brocade, which is looking to step up its attacks on Cisco, the market leader, and benefits from IBM's reputation.

"That (IBM) brand obviously carries tremendous value," Dave Stevens, Brocade's chief technology officer, said in an interview.

IBM said in a statement that the expansion of the agreement with San Jose, Calif.-based Brocade is about giving customers more choices. Armonk, N.Y.-based IBM said it continues to work with Cisco and that the two companies have a strong relationship.

But after growing into one of Silicon Valley's most prominent companies by selling behind-the-scenes computing products, Cisco is now expanding aggressively, saying in recent weeks that it will start selling servers. That has opened a new rivalry with longtime partners like Hewlett-Packard Co. and IBM and shows how the landscape for back-end technologies is changing fast as companies hunt for growth in their allies' backyards.

Other examples are Oracle Corp.'s proposed $7.4 billion acquisition of Sun Microsystems Inc. (a shot at both HP and IBM) and HP's $13.9 billion takeover of Electronic Data Systems (a bid to better challenge IBM in services). HP is also getting more aggressive about pushing its own networking products that compete with Cisco.

IBM stopped making its own routers and switches in 1999 when the company sold that intellectual property to Cisco.

©2009 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

Explore further: Monoprice takes on Amazon in trade of cheap electronics

add to favorites email to friend print save as pdf

Related Stories

Cisco announces its first servers, riling rivals

Mar 16, 2009

(AP) -- Cisco Systems Inc. wants a bigger chunk of the corporate computing market, and plans to start selling servers in competition with old partners like Hewlett-Packard Co. and IBM Corp.

IBM cuts Sun takeover price: WSJ

Apr 02, 2009

IBM has cut the price of its takeover bid for Sun Microsystems Inc. to nine to 10 dollars a share from 10 to 11 dollars a share, The Wall Street Journal online reported on Thursday.

The Cisco bid: To branch out while others retrench

Apr 05, 2009

(AP) -- On the surface, there doesn't seem to be much of a connection between the servers that run corporate data centers and a handheld video camera you use to film family vacations. Yet both have somehow become part of ...

Recommended for you

Chinese tech giant Alibaba set to make a splash with US IPO

6 hours ago

The largest tech IPO of the year will come from a company that many Americans have never heard of. Alibaba Group - a Chinese e-commerce behemoth - has decided to go public in the U.S. after months of speculation that it would ...

Ex-Apple chief plans mobile phone for India

Apr 19, 2014

Former Apple chief executive John Sculley, whose marketing skills helped bring the personal computer to desktops worldwide, says he plans to launch a mobile phone in India to exploit its still largely untapped ...

Airbnb rental site raises $450 mn

Apr 19, 2014

Online lodging listings website Airbnb inked a $450 million funding deal with investors led by TPG, a source close to the matter said Friday.

User comments : 0

More news stories

Making graphene in your kitchen

Graphene has been touted as a wonder material—the world's thinnest substance, but super-strong. Now scientists say it is so easy to make you could produce some in your kitchen.