Cisco Systems Inc. has acquired vCider, a cloud-computing startup that, theoretically, could provide a way to compete with VMware Inc. and its recent Nicira Networks Inc. acquisition.

The deal was announced on Cisco's blog Thursday morning.

vCider, a Silicon Valley startup, has built what Cisco describes as "a multi-tenant distributed virtual network controller" that can build overlay connections on top of a network. It's now being added to Cisco's work in Quantum, OpenStack's networking framework for cloud computing.

Overlays are what Nicira does. Its controller tells switches to create tunnels for particular data flows. Big Switch Networks, which uses OpenFlow to build virtual networks, plans to support overlays as well.

And now Cisco could do it, too -- possibly by integrating vCider into Cisco gear.

vCider could thus become "a virtual service that runs under a Nexus 1000v or an ASA [Cisco's Adaptive Security Applicance]," says Zeus Kerravala, principal analyst with ZK Research. Another source from the SDN community proposed the same thing. (Light Reading has a query in to Cisco about it.)

That's just an on-paper theory, but a compelling one. The acquisition of Nicira brings VMware uncomfortably close to being a networking competitor to Cisco. In fact, rumors persist that Cisco wanted Nicira as well, which helped drive the startup's price beyond $1 billion.

Before being made famous by Cisco, vCider had been pitching itself as a security play. The company's software unifies multiple clouds into one big cloud -- similar to what's done by CloudSwitch (now part of Terremark, which is part of Verizon Communications Inc.) or by startup LonoCloud. Its 2.0 version, released in February, emphasized the ability to run firewalls and intrusion detection systems inside that bigger cloud.

vCider is being inserted into Cisco's Cloud Computing organization, under CTO Lew Tucker.

For more

• Cisco SDN Exec Joins Arista
• Does Cisco Need Nicira?
• VMware Insists It's Not Warring With Cisco
• Cisco Takes ONE Step Beyond SDN

— Craig Matsumoto, Managing Editor, Light Reading