It appears the latest casualty in the switch-fabric market is PetaSwitch Solutions Inc., as the chipmaker plans to shut down at the end of the month.

Vice president of marketing Fred Kamp announced the decision via email this afternoon. PetaSwitch joins Power X Networks Ltd. and TeraCross Ltd. in the dead pool of fabric startups (see Power X Powers Down and TeraCross Shuts Down).

PetaSwitch aimed high, saying its chips could drive a system with 2.5 Tbit/s aggregate capacity. But with sales prospects dim for high-end switch fabrics, investors have chosen to shutter the company.

The company received $4 million in funding from Wasserstein Ventures and Draper Fisher Jurvetson in 2001 and debuted its Pisces chip set the following year (see Packet Switch Chips).

Pisces tanked. By January 2003, PetaSwitch had trimmed staff to 12, from a peak of 24, and put itself up for sale -- a process that "turned out to be as difficult as finding VC funding," Kamp wrote.

The sagging economy has been particularly rough on merchant switch fabrics, because the devices usually target new systems being designed from scratch. OEMs, meanwhile, have put much of their new-system development on hold, preferring to build enhanced line cards for installed equipment.

Switch fabric vendors can only hope that OEMs will soon start a new cycle of systems development, one that would target production around 2006 (see ZettaCom Lands $19M).

Of course, it's been a rough time for all the devices related to network processors. Vendors of search engines and content-addressable memories have been cutting back, too (see Mosaid Cans CAMs).

— Craig Matsumoto, Senior Editor, Light Reading