Cisco to acquire software-defined, wide area networking vendor Viptela for US$610 million

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Cisco to acquire software-defined, wide area networking vendor Viptela for US$610 million

Cisco said it plans to acquire Viptela, a developer of software-defined, wide area networking (SD-WAN) technology, for US$610 million in cash and assumed equity awards. 

With the acquisition, Cisco is looking to place its stake in the cloud-based SD-WAN technology. The acquisition is slated to close in the second half of 2017.

Viptela provides SD-WAN technology to several Fortune 500 companies and carriers like Verizon. Its offerings include the vSmart Cloud-based SDN-WAN Controller to centrally manage routing, policy, security, segmentation and authentication of devices; vManage Network Management System for centralised configuration and management; and vEdge routers.

Once acquired, Viptela would be the third SD-WAN technology offered by Cisco. Cisco IWAN is an on-premises SD-WAN technology, and Cisco Meraki is a cloud-based SD-WAN offering with unified threat management capabilities. Cisco acquired Meraki in 2012.

Rob Salvagno, vice president of corporate business development at Cisco, wrote in a blog post on Monday that Viptela offers a cloud-first approach to SD-WAN with cloud orchestration and branch network management as well as overlay technologies.

Salvagno wrote: "With Viptela, Cisco can offer customers more choice in their enterprise branch offices and WAN deployments, with a compelling SD-WAN solution that is easy to deploy and simple to manage."

"Together, Cisco and Viptela will be able to deliver next generation SD-WAN solutions to best serve all size and scale of customer needs, while accelerating Cisco’s transition to a recurring, software-based business model," Salvagno wrote.

Cisco said it expects to combine Viptela's cloud-first capabilities with Cisco's SD-WAN capabilities to accelerate the move to next-generation SD-WAN offerings.

For Cisco, the acquisition provides a well-designed cloud-based SD-WAN technology, said Prashanth Shenoy, vice president of product marketing for enterprise networks at Cisco.
 
"Customers are looking to move SD-WAN to the cloud even as the SD-WAN market quickly grows," Shenoy told CRN USA. "IDC projects the total addressable market for SD-WAN to be US$6 billion by 2020."
 
Unlike Cisco's current IWAN technology, which is focused on on-premises SD-WAN deployments, Viptela is focused on cloud-based SD-WAN, Shenoy said.
 
"Viptela is a cloud-first management and orchestration solution," he said. "It fits well with IWAN. This is an opportunity to bring them both together to provide customers with both cloud-first or on-prem technology."
 
The combination of IWAN and Viptela serves a different customer base than Cisco's Meraki offering, Shenoy said. Cisco Meraki is a full-stack solution with routing, switching, wireless, and enterprise mobility management as a completely integrated offering.
 
"Viptela is being used by Fortune 500 companies and service providers, especially those with complex deployments where Meraki may not be the best choice," he said. "For customers with broad, complicated deployments with a variety of technologies like MPLS, Viptela is the best."

Shenoy did not agree with the solution provider that Cisco was late to the SD-WAN market, and said that "late" was a pretty subjective term that depends on use cases.

"You have to see what customers want and whether Cisco provides the technology," he said. "Cisco with IWAN addressed the need for on-premises SD-WAN. Other vendors like Viptela offer other technologies."
 
Shenoy said that he cannot discuss integration plans for Viptela before the acquisition closes. However, he said, the integration can start immediacy after the close given that Viptela offers an overlay technology.

This article originally appeared at crn.com

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