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Procket Founder Takes On Servers

One thing about those Procket guys -- they know how to think big.

After taking his lumps against (Nasdaq: CSCO) and (Nasdaq: JNPR) in core routers, former Procket Networks CEO Sharad Mehrotra is accepting a job that doesn't sound much easier: CEO of a company targeting the high-end server franchises of Hewlett-Packard Co. (NYSE: HPQ), IBM Corp. (NYSE: IBM), and Sun Microsystems Inc. (Nasdaq: SUNW).

Dubbed Fabric7 -- which has no known relationship to Wave7 or Blake's 7 -- the 80-employee startup today announced its Q80 and Q160 servers, which combine Advanced Micro Devices's (NYSE: AMD) Opteron processors with proprietary switching technology. The latter gives the boxes speed comparable to high-end Unix systems or even mainframes, despite using off-the-shelf chips, Fabric7 officials claim. (See Fabric7 Unveils Servers.)

Fabric7 has raised $32 million from investors including New Enterprise Associates (NEA) -- where Mehrotra was a partner -- Foundation Capital, Goldman Sachs & Co., Sanmina-SCI Corp. (Nasdaq: SANM), Selby Venture Partners, Vanguard Venture Partners, and Yasuda Enterprise Development Co. Ltd.

Mehrotra's last attempt at this sort of thing ended in disappointment. Procket finished its core router, but a brutal telecom market coupled with Procket's high tab -- its venture funding exceeded $300 million -- doomed the company. In 2004, Procket had to settle for selling pieces of itself to Cisco. (See Cisco to Pay $89M for Procket Assets.)

Mehrotra, one of three Procket founders, was long gone by then. He'd been replaced as CEO in 2001 and had left Procket's board by 2002, having joined NEA. It was there that he developed the ideas that became Fabric7, which launched in May 2002 and began to emerge last year after raising its B round. (See Bigwigs out of Procket? , Execs Cast a Wide Net, and Fabric7 Feasts on $17.5M.)

So, what's to keep Fabric7 from falling into oblivion like Procket?

"It's a very consolidated market. The big vendors are vulnerable in their high-end machines, all for different reasons, so I think we're in a good position to pull this off," Mehrotra says.

And Mehrotra isn't shaking off the lessons from the Procket ride. "A lot of what happened to the last project, certainly some of it had to do with the bubble, but a lot of it didn't," Mehrotra says. One difference from Procket is that Fabric7 is taking advantage of off-the-shelf chips -- not just the AMD chips, but network processors and switch fabrics, too. That's giving the company a faster start at a cheaper price.

"Unlike Procket, we didn't have to spend $150 million on a set of chips," Mehrotra says. "This company was a chance to take all the beneficial ideas about networking and synthesize them to this family of machines at a cost structure that's one-tenth of what we did last time."

Having worked at Sun, Mehrotra comes from a computing background. He sees Fabric7 as a chance to add his networking experience to the mix. The way he reasons it, servers shuffle data from one point to another just as routers do -- so why not apply some new switching technology to the concept of clustering servers?

Using a concept similar to a router's switch fabric, Fabric7 can link servers arbitrarily and "build computing structures completely on the fly," Mehrotra says. This means Fabric7's boxes can be linked together to act as one, an idea similar to the multichassis configurations pursued by Procket and other router vendors.

Different servers could become team players within this distributed environment. One server could handle all connections to a storage-area network, for example, while servers on other sites run the applications that use the SAN. And servers would be able to shift tasks instantly. That's a key point, because it creates a more fluid data center where computing power can be reassigned to particular areas in need.

Fabric7 shares one of Procket's biggest problems, though: a stubbornly difficult market. The customers for high-end servers bear strong resemblance to the buyers of terabit routers, and that's not good news for a startup.

"Big iron, no matter how you look at it -- PBXs, servers, switches -- it's a conservative buy," says Rob Enderle, principal analyst of The Enderle Group, noting that the purchase is so expensive that buyers "want to make sure the company is rock solid." That puts startups at a handicap. On top of that, the sales cycle for high-end servers is long -- just as it is for core routers -- meaning revenues are slow in coming.

A startup's best hope is to partner up with one of the big players, Enderle says. Such pairings can lead to an acquisition -- a happy exit. Or, they could just delay the end: "Eventually, they might backfill you with one of their own products, and then you're done," he says.

Naturally, Mehrotra would like Fabric7 to succeed, but he concedes that the odds are against him, just as they were with Procket. He doesn't seem to let that bother him. "Entrepreneurs do what they do mainly because they like to do these projects," he says. "What drives me are difficult markets with enormous payoffs. That's why you see me doing these projects."

— Craig Matsumoto, Senior Editor, Light Reading

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tsat 12/5/2012 | 2:55:27 AM
re: Procket Founder Takes On Servers
Did they make these servers with any new silicon? What is their fabric that connects the processors?

Off-the shelf? FPGAs?

-tsat
Pete Baldwin 12/5/2012 | 2:55:26 AM
re: Procket Founder Takes On Servers Our LR pages are replete with stories of the terabit router crew. Avici and Chiaro are still around, but you had Ironbridge, Pluris, Hyperchip, Charlottes Web....

How about the server side? Can anyone out there regale us with tales of doing battle with Sun?
Pete Baldwin 12/5/2012 | 2:55:26 AM
re: Procket Founder Takes On Servers My understanding is that they're doing this with off-the-shelf silicon, including the switch fabrics.
tsat 12/5/2012 | 2:55:24 AM
re: Procket Founder Takes On Servers
I just don't think there is any off-the-shelf part that interfaces an off-the-shelf switch fabric to a 64bit high-end processor? Lots of questions here.. like, is it shared memory?
sigint 12/5/2012 | 2:55:23 AM
re: Procket Founder Takes On Servers I just don't think there is any off-the-shelf part that interfaces an off-the-shelf switch fabric to a 64bit high-end processor? Lots of questions here.. like, is it shared memory?
________________________________________________

I guess there could be a possibility with AMD processors+NVIDIA chipsets (HyperTransport-->PCI Express). Their website does suggest that some of their offerings are driven by AMD processors.
ron202 12/5/2012 | 2:55:21 AM
re: Procket Founder Takes On Servers I guess there could be a possibility with AMD processors+NVIDIA chipsets (HyperTransport-->PCI Express). Their website does suggest that some of their offerings are driven by AMD processors

are they using AS ( some companies are developing AS switches)?
fiat_lux 12/5/2012 | 2:55:19 AM
re: Procket Founder Takes On Servers I guess that PCI-express is the primary protocol. It's a telecom influenced protocol and there have been switch fabric chips available for it for some time now.

Traditionally latency is the key parameter for supercomputer switching fabrics, but if they are competing with servers and mainframs (i.e., no parallel algorithms), bandwidth is probably more important than latency, especially if they provide some way to feed the server threads which doesn't require locking: like queues.
ron202 12/5/2012 | 2:55:17 AM
re: Procket Founder Takes On Servers for PCI-e usually you have a bridged function. AS (advanced switching) allows switching connectivity (phy layer is pci-e). Didn't checked if NVIDIA has also an AS port in their controller.
AAL6 12/5/2012 | 2:55:17 AM
re: Procket Founder Takes On Servers What about these guys (http://www.liquidcomputing.com... ?
It seems that there are quite a number of startups now triyng to apply telecom switching to the server market.
rexhaus 12/5/2012 | 2:55:16 AM
re: Procket Founder Takes On Servers
> What about these guys (http://www.liquidcomputing.com... ?
> It seems that there are quite a number of startups now triyng to > apply telecom switching to the server market.

The path to greatest success in the computing market has most often been to start from the low-end. There are a few exceptions like non-stop/reliability architectures, but the industry is a classic case of "disruptive technologies". Dec and Minis did it to the mainframe. Microcomputing, UNIX and did it to minis. Windows did it to UNIX on the desktop, and essentially the same commodity hardware with Linux has done it to UNIX/Sun servers.

Sun, HP et al know how to build, and more importantly support with an ecosystem and clasic support, bigger boxes.

The upstarts are trying to commoditze something with a pricepont in the high 5-figures to 6-figures. Presumably (maybe a big assumption) the "incumbent" server vendors will be aggressive enough on pricing/discounts to make it a non-issue.)
At this pricepoint, buying a system likely means "betting your job", so all the arguments about company stability, investment protection, support, etc. kick in, and give a big advantage to the bigger companies.

Not clear to me that many, if any at all, of these companies have a prayer of success. Best outcome might be to be acquired, but since they have little sustainable technology, what does the acquirer get for their trouble?

REx
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