Cisco buys its way into AT&T SDN

cisco aquistion

Cisco this week announced its intent to acquire privately held Tail-f Systems, a developer of multivendor network service orchestration systems for traditional and virtualized networks, and one of the vendors AT&T selected for its Domain 2.0 SDN/NFV project.

Under the terms of the agreement, Cisco will pay $175 million in cash and retention-based incentives in exchange for all shares of Tail-f, which is based in Stockholm.

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With the Tail-f acquisition, Cisco essentially buys its way into AT&T Domain 2.0 initiative, an effort to virtualize the AT&T service network with software-defined networking and network functions virtualization. Tail-f is one of six vendors AT&T has identified publicly as Domain 2.0 suppliers, a list that also includes Ericsson, Metaswitch Networks, startup Affirmed Networks, Juniper Networks and Amdocs.

Domain 2.0 is viewed as a negative for Cisco’s Application Centric Infrastructure programmable networking strategy due to AT&T’s reported preference for commodity, white box hardware and SDN controllers. VMware’s NSX network virtualization platform is also already present in AT&T data centers.

Cisco, though, is expected to retain its incumbency in AT&T’s WAN.

Tail-f’s products help service providers and enterprise IT organizations implement cloud applications and network services across multivendor networking devices. They also help reduce time-to-market for network equipment vendors building equipment for software-programmable networks, Cisco says.

Tail-f’s network service orchestration technology will help Cisco provide products that simplify and automate the provisioning and management of both physical and virtual networks in the cloud. Tail-f’s software also addresses provisioning of traditional Layer 2/3 VPNs as well as next-generation networks based on NFV and programmability, Cisco says.

screen shot of Tail-f site

“The acquisition of Tail-f’s network services configuration and orchestration technology will extend Cisco’s innovation in network function virtualization, helping service providers reduce operating costs and the time it takes to deploy new services, making agile service provisioning a reality,” states Hilton Romanski, senior vice president of Cisco Corporate Development.

Upon completion of the acquisition, Tail-f employees will join Cisco’s Cloud and Virtualization Group led by Gee Rittenhouse, vice president and general manager. The acquisition of Tail-f is expected to be completed in Cisco’s fiscal fourth quarter, which ends in July.

Tail-f has 90 customers, including seven of the top 10 network equipment providers, as well as a number of Tier 1 service providers in addition to AT&T. Deutsche Telekom is also a Tail-f customer.

Rittenhouse says Tail-f will allow Cisco to participate in all service provider SDN/NFV transformations in addition to AT&T and Duetsche Telekom. He also says the acquired technology will be a "critical component" of Cisco's InterCloud strategy to federate cloud networks from different providers, and from Cisco and its partners.

"It's a leading way of orchestrating and service chaining security, firewalling and virtualized CPE together with the NETCONF/YANG (interface)," he says. NETCONF/YANG is fast becoming a preferred southbound interface in the service provider industry for SDN/NFV orchestration and configuration.

"Cisco recognizes the importance of NETCONF/YANG," Rittenhouse says.

He also says Tail-f fits into Cisco's broader SDN portfolio, such as the policy and analytics framework devised by the company's Insieme business unit and embodied in ACI and the Nexus 9000 switch product line. Rittenhouse said Cisco won't tightly couple ACI and Tail-f the way ACI and InterCloud are intertwined, but will tout the benefits of the combination of the two.

"We will respect the openness of the NETCONF/YANG platform and model," he says, adding that the Tail-f acquisition is one of strategic value in time-to-market as well.

Cisco's ACI uses the internally developed OpFlex southbound protocol for policy abstraction and instantiation. Cisco claims OpFlex is open through its submission to the IETF and the OpenDaylight open source SDN project.

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