Cisco buys rest of Insieme Networks

Cisco Systems, the world's biggest networking gear maker, yesterday said that it would buy the remaining stake it does not already  own in Insieme Networks.

In a release, the company said the maximum potential payout for Insieme, a company run largely by former Cisco executives, would be $863 million.

Insieme is run by Cisco's  three best switching and silicon engineers Prem Jain, Mario Mazzola and Luca Cafiero.

Cisco, which already holds 85 per cent of Insieme, had created the company in early 2012 with an investment of $100 million and followed it up by investing a further $35 million in November 2012.

Insieme has developed a 40 gigabit ethernet transceiver designed to significantly lower the price of 40-gigabit optics to better compete with lower cost switches from Arista Networks, Huawei and ''white box'' switches based on merchant silicon.

It is developing the Nexus 9000 line of data centre and cloud switches that feature application awareness to make the network infrastructure flexible and agile for dynamic response to application needs and virtual machine workload mobility.

Cisco said that it continues to promote the role of hardware in delivering future high performance networks and took great pains to distance itself from pure software based overlay virtualised networks like the Nicira technology VMware acquired, Junipers Contrail, and Alcatel-Lucent's Nuage in the data centre.

Insieme's ACI solution consists of 100 Gbps ready Nexus 9000 Series switches that run under a new optimised version of NX-OS and can support up to 1.92 Tbps of bandwidth capacity per slot.  The 8-slot Nexus 9508 is available now, and other switches in the family are expected soon.

The Application Policy Infrastructure Controller (APIC) supports a common policy framework that Cisco will extend to bring compute, storage, and network infrastructure under a common pane of glass for management and control. APIC uses a common application network profile similar to the service profile in Cisco's UCS that will allow applications to be placed where they need to be instead of being tied to an IP address. APIC and the optimised NX-OS will be available in April 2014.