In what may be the first of many consolidations in the SD-WAN space, Cisco today says it is buying SD-WAN startup Viptela for $610 million.
The two companies shared a major customer with Verizon -- and some familiar faces because Viptela Inc.'s CEO is former Cisco exec Praveen Akkiraju -- but they were also serious competitors in the SD-WAN space, which blew up quickly and just as quickly got very crowded. The Cisco acquisition ends speculation as to whether Cisco would buy an SD-WAN startup and which one -- the other most rumored candidate is Versa Networks , now led by another former Cisco exec, Kelly Ahuja. (See Viptela Names Ex-Cisco Exec as New CEO.)
Viptela was one of the first SD-WAN players to emerge from stealth mode, staking its claim three years ago as a champion of companies looking to make wide area network connections easier and less expensive, using Internet access. Using a cloud-based approach, Viptela spread its wings into the service provider space, landing Verizon but also Singtel and multiple Asian service providers in Pakistan and Japan. (See SingTel Teams With Viptela on SDN-Based Service, Verizon Launches Virtual Network Services, Working in the Cloud – Infographic and NTTPC Comms Deploys Viptela's SD-WAN Solution .)
While network operator interest in SD-WANs grew quickly, so did the pool of providers, including fellow startups Versa and VeloCloud Networks Inc. and existing companies like Cisco and RAD Data Communications Ltd. , and other players such as Silver Peak Systems Inc. The market quickly became ripe for consolidation, a space in which Cisco has never been shy.
According to Cisco's announcement, acquiring Viptela will enable it to accelerate "next-generation SD-WAN solutions" by "combining Viptela's cloud first network management, orchestration and overlay technologies with industry-leading routing platforms, services, and SD-WAN capabilities from Cisco." Cisco isn't giving up its existing Cisco Intelligent WAN and Meraki SD-WAN solutions, the company said, but combining them all into a portfolio of software-centric products.
That next-gen leap makes sense as vendors are looking to differentiate their SD-WAN products adding analytics, visibility, security and more to make WAN services more application-driven.
"Viptela's technology is cloud-first, with a focus on simplicity and ease of deployment while simultaneously providing a rich set of capabilities and scale. These principles are what today's customers demand," said Scott Harrell, senior vice president of product management for the Cisco Enterprise Networking Group, in a prepared statement. "With Viptela and Cisco, we will be able to deliver a comprehensive portfolio of comprehensive on-premises, hybrid, and cloud-based SD-WAN solutions."
— Carol Wilson, Editor-at-Large, Light Reading
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