April 19, 2012
Cisco Systems Inc. (Nasdaq: CSCO) has confirmed that Insieme -- with an "e" at the end -- is working on software-defined networking (SDN) and that the project is, indeed, another spin-in from former Cisco executives.
CEO John Chambers confirmed Insieme's existence and purpose during a press roundtable at a Cisco partner event Tuesday, Network World reported. The investment in Insieme is US$100 million so far and will max out at $750 million.
Insieme is founded by Mario Mazzola, Luca Cafiero and Prem Jain -- the same executives who did previous spin-ins Andiamo and Nuova. A spin-in is a startup that's being nurtured for Cisco to acquire; outsiders think of it as an internal project with a much bigger payout promised.
Chambers has been saying that Cisco has a plan for SDN, a set of technologies that lets operators program routers and switches more flexibly. He emphasized Tuesday that Insieme's approach will include Cisco-designed ASICs as opposed to off-the-shelf chips, keeping consistent with Cisco's belief that chip design can be a key advantage for a high-end systems vendor.
The whole thing has come together very quickly. Sources have been telling Light Reading that Insieme (originally thought to end in an "i") wasn't even created until March. Word about the company leaked immediately after that.
Why this matters
It's almost a formality, but Cisco's attention makes it official that SDN is a big deal. Whether the technology radically changes the switch and router business, or just becomes an add-on feature, won't be determined for a few years. Exactly what Cisco is working on isn't known yet, though.
The spin-in thing has been a source of some controversy, because it means some Cisco employees will be working for normal salary while others are practically guaranteed the rewards of a startup buyout.
In any event, a spokesman told Light Reading Wednesday that Insieme's work will be blended with an overall architectural plan at Cisco. In other words, Insieme is going to be working with other parts of the company and isn't purely a maverick group.
It's been a big week for SDN, thanks to the Open Networking Summit:
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