Year in review 2015

10 most important networking acquisitions of 2015

Breaking down the mergers and acquisitions from this year that will have the biggest long-term impact on the networking industry.

top networking mergers 2015 1
Big money

2015 was a big year for mergers and acquisitions in the networking industry. Here are the ones that are most likely to have the biggest long-term impact on the industry.

Check Point Software acquires Hyperwise Lacoon
Check Point Software acquires Hyperwise and Lacoon

Although these were small acquisitions (both in the $80 million range), they were notable as Check Point rarely makes acquisitions. Check Point has been one of the leaders in combatting threats that go through a firewall, but more hackers are now finding ways to get around perimeter security. These acquisitions help Check Point’s customers fight the security fight on other fronts.

Hyperwise’s SandBlast technology hunts down malware that evades sandboxing mitigation solutions. 

Lacoon is a mobile security solution for Android and Apple devices. Mobile device management (MDM) has been a hot market over the past five years, and Check Point hasn’t been able to participate in it. Lacoon’s differentiator is that it has a cloud-based analytic engine.

Cisco acquires OpenDNS Lancope
Cisco's security acquisitions

Cisco, the industry’s largest security vendor, was lagging behind many of its competitors just a few years ago. This year was a big one for Cisco security, spending more than $1 billion in two major acquisitions. 

In June, Cisco announced plans to acquire OpenDNS for $635 million, an important component of the Security Everywhere initiative that Cisco announced at Cisco Live in June. OpenDNS is a cloud service that protects customers from connecting to dangerous websites by offering security DNS services.

In October, Cisco announced it will acquire long-time partner Lancope for about $450 million. Cisco has been positioning the network as both a security sensor and mediator, and Lancope’s analytics, visibility, and security intelligence fit that vision nicely.

HP acquires Aruba Networks
HP acquires Aruba Networks

HP, or HP Enterprise as it’s known now, announced in February it was acquiring Aruba Networks for $3 billion. This was a significant move for HPE for a number of reasons. First, the company does have a broad networking portfolio, but it did lack a credible wireless solution. Aruba has been duking it out with Cisco for technology leadership for years, and has a great portfolio that includes a robust management software, strong integrated security, analytic tools, and everything else needed to help its customers maximize the potential of Wi-Fi. Additionally, HPE inherits some great talent, including Aruba CEO Dominic Orr, to run HP Networking, and Aruba’s founder, CTO, and one of the smartest guys I know, Keerti Melkote.

Avago acquires Broadcom
Avago acquires Broadcom

Avago’s $37 billion acquisition of rival semiconductor manufacturer Broadcom was one of the largest technology purchases of all time.

Avago has strength in wireless communications, enterprise storage, wired infrastructure, and industrial equipment. Broadcom chips are used primarily in wired networking devices and Apple and Samsung smartphones. The combined organization will be the third largest U.S. semiconductor supplier, behind Intel and Qualcomm, and sixth largest in the world.

Intel acquires Altera
Intel purchases Altera

Continuing the chip theme, 2015 also saw Intel pony up $16.7 billion for Altera. The two companies are long-time partners and had collaborated on chip design in the past. In the press release announcing the acquisition, Intel stated it would be using Altera’s FPGAs for high-performance computing products, IoT products, and data center infrastructure, all markets in which Intel has steadily been gaining share. This will help Intel keep the momentum going.

emc acquires virtustream
EMC acquires Virtustream

EMC has been building a nice portfolio of companies in its Federation. In May, it added managed cloud services company Virtustream for $1.2 billion. Virtustream is a nice addition to the other Federation companies, including VMware, RSA, and VCE. The managed services and consulting services from Virtustream can be the glue that ties the public and private cloud solutions together.

BlackBerry acquires Good Technology
BlackBerry makes Good

As a Canadian, the thing that makes me saddest is the fact a Canadian team hasn’t won the Stanley Cup since 1993. Second on my list is the demise of BlackBerry. The company that once ruled the world of mobility has found itself fighting for its life.

In September, BlackBerry announced it was acquiring Good for $425 million. Typically, I’m not a fan of two struggling companies merging, since that normally leads to one larger organization that suffers the same struggles. However, in this case, there is some logic and potential to the merger. If BlackBerry has an area of strength today, it’s security, and the addition of Good can help it catch the mobile security wave.

Nokia acquires Alcatel-Lucent
Nokia acquires Alcatel-Lucent

In April, Nokia announced it was planning to acquire Alcatel-Lucent for $16.5 billion, bringing together the wireless strengths of Nokia and the wireline assets of Alcatel-Lucent. Given the growth of 4G, the transition to VoLTE, and the fact we are becoming a mobile-first world, it’s important that vendors come to market with an end-to-end, core-to-radio network solution. Currently, the only two vendors that can offer this are ZTE and Huawei. Nokia-ALU will pose a viable alternative.

Citrix acquires Sanbolic
Citrix acquires Sanbolic

For Citrix, the year started off with a bang as it announced it was acquiring Sanbolic in January. The acquisition provides Citrix the technology to virtualize and “software-define” various storage types, including SAN, NAS, SSD, and flash. With Sanbolic, Citrix can come to market with a broader software-defined data center story. 

At the time, I speculated that Citrix might follow up this acquisition with another acquisition to move into the software-defined networking space. Much has changed for Citrix since January, and the company finds itself embroiled in speculation on how to break it up or sell off parts, so this prediction isn’t likely to come true anytime soon.

Dell acquires EMC
Dell acquires EMC

This should be considered the Super Bowl of acquisitions. HP decided to split and become more agile. Dell did the opposite and plunked down a cool $67 billion for EMC.

To address the growing complexity in IT, more vendors are coming to market with integrated, turnkey solutions with validated designs. Dell and EMC can do that, whereas each alone could only do so through partnership (although partnering is a viable strategy). 

The acquisition has raised all kinds of questions about the fate of VMware, what it means for technology partners, and how customers should deal with it. We won’t really know the answers to these until 2016 or later, so there’s more to expect out of the Dell/EMC camp.