Nauticus Dives Into the Data Center

Just over a year after stepping out of stealth, data-center equipment player Nauticus Networks Inc. finally has some switches to sell (see Nauticus Emerges From Stealth Mode and Nauticus Launches DC Switches).

With the announcement of its first products today, the N2000 and N2000V switches, Nauticus aims to simplify the typically complex topology of the data center. Powered by its TideRunner chipset, the switches both offer Layers 4 to 7 switching, integrated with security services like core load balancing and SSL acceleration. In addition, the N2000V includes virtualization capabilities that allow companies to create multiple virtual switches within a single physical device.

The switch aims to leapfrog current Layer 4-7 switch platforms by adding more speed in addition to improved capability to "virtualize," which enables the switch to parcel out various software features for different users of the product.

“The virtualization features address the need for flexible provisioning of services, while reducing opex for data center managers, along with offering significantly higher performance levels,” writes Infonetics Research Inc. analyst Neil Osipuk in an email.

“These devices can reduce your box count from dozens to half a dozen,” agrees Burton Group analyst Bill Terrill.

But industry observers also point out that the startup faces significant challenges entering a market loaded with players. “They will face significant competition in the Layer 4-7 Switch/Load Balancer with SSL market from current market leaders F5 Networks Inc. [Nasdaq: FFIV] and Cisco Systems Inc. [Nasdaq: CSCO], with Nortel Networks Corp. [NYSE/Toronto: NT] entering this segment as well,” Osipuk writes.

And while these legacy players don’t offer virtualization, startup Inkra Networks has had nearly a year’s headstart in providing virtualized switching for the data center and already has a number of paying customers (see Inkra Virtualizes Data Center and Inkra Sells Some Switches).

Nauticus and Inkra are pursuing slightly different markets. Inkra has focused on the carrier and large enterprise markets, virualizing as many features as possible, with things like firewalls and VPN modules provisioned into its virtual switches. Nauticus has focused more on high-speed load-balancing aspect of the data center for large enterprises. Its switches do not include internal firewalls, but if hooked up to an external appliance, they can add more processing power to the device.

Nauticus claims that with 16,000 connections per second of SSL processing and 4 Gbit/s of encrypted throughput, its switches offer more than a tenfold improvement in price/performance over the nearest competitor. The company, which has received $38 million in funding to date, is currently going through the benchmarking procedures.

Regardless of whether customers are looking for speed or more virtualized features, analysts say that both Nauticus and Inkra may have a hard time pulling through in today’s troubled market. “First, they have to convince customers that they should virtualize, and then they have to convince them that they should buy from a startup,” says Yankee Group analyst Zeus Karravala. “I don’t believe that the market is quite there yet… I think the window of opportunity is fairly small… What will probably happen is that they’ll be acquired.”

One of the problems with convincing customers to move to a virtualized switch is the learning curve, Terrill says. The new products require users to learn how to provision them and use new management tools, which can be very complicated processes. “The front-end learning curve on both companies management is still going to be pretty steep,” he says. “Anything in a data center’s a pain.” However, he continues, “Once you’ve gotten past the initial learning curve, things should be a lot easier.”

The Nauticus switches won’t actually be generally available until the end of this month, but Nauticus CEO Joshua Weiss says the company has “already sold some switches” and that about six companies are currently beta-testing the boxes.

Pricing for the N2000 will start at $25,000, and the N2000V will start at $35,000.

— Eugénie Larson, Reporter, Light Reading

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