Cisco reportedly is considering a "spin-in" company of Cisco engineers, which would develop a switch for software-defined networking environments.
Cisco Systems reportedly is considering funding a startup run
by Cisco engineers that would focus on the growing trend within data centers of
According to a story in The
New York Times,
the startupwhich would be called Insiemiwould develop
a switch that essentially would take many of the networking tasks that now are
done on expensive pieces of hardware and do them in software instead.
Such software-defined networking (SDN) environments, which
leverage the OpenFlow protocol, are cropping up in data centers that run such
computing models as cloud computing. In March 2011, a number of major tech firmsincluding
Google, Facebook, Microsoft, Yahoo and Verizoncreated the Open
, a nonprofit group whose aim is to drive innovation
around SDN, in part by pushing the continued development of OpenFlow.
SDN is seen by proponents as a way to give IT administrators
greater control over their networking environments, thanks to such aspects as
relatively easy software upgrades and by powering down routers that are not in
use, thus saving energy costs. The software works as a controller of everything
else going on in the network, something normally done. SDN can run on hardware
that uses off-the-shelf processors, rather than needing more expensive
A growing crop of smaller networking vendors, such as Arista
(started by former Cisco employees, including Arista president and
CEO, Jayshree Ullal) and Nicira, are leveraging SDN development to better
compete with the likes of heavyweights
Cisco and Hewlett-Packard, which offer high-end networking hardware.
Cisco officials have said they plan to add OpenFlow to
upcoming switches (HP also has embraced the protocol), and President and CEO
John Chambers has recently said the company is aggressively pushing to expand
its software capabilities in several business areas, including networking and
video. During a Webcast last week to talk about Ciscos intention to spend $5
billion to buy NDS
, a video software vendor, Chambers said the deal marked a significant
step in his companys efforts to grow its software capabilities.
Insiemi would be another step. According to reports, the plan
would be to help the three Cisco engineersMario
Mazzola, Prem Jain and Luca Cafierostart up the company and develop the
product through both support and funding. If the product development is
successful, Cisco would then bring the company into the fold, buying Insiemi
from the Cisco engineers.
Citing unnamed sources, The New York Times
officials are currently discussing the idea of Insiemi, and could announce
their plans in the late spring.
This wouldnt be the first such spin-in
(as opposed to a spin-out) project with the same three engineers. Two other
Systems (storage networking) and Nuova Systems
(data center switch)
developed products, and then were bought by Cisco. The networking giant had
invested $70 million in Nuova, for example, and bought it for $678 million.
also said that while such a spin-in project can bring new products to the
company, they also can cause morale problems among employees not chosen for the
new company. And those engineers who are chosen are handsomely rewarded for
working on what ends up being a Cisco product when Cisco buys the company.
Arista CEO Ullal, while at Cisco, reportedly was critical of spin-ins.