Riverstone no longer an enterprise LAN company

Riverstone retreats to focus on service-provider roots

Enterprise network equipment buyers recently lost an alternative, but chances are they won’t really miss it.

A year ago Riverstone Networks had been repositioning its carrier-focused gear to accommodate enterprise environments. While network equipment in general had been hurting, it seemed more money was coming from enterprise firms than from service providers, and Riverstone was reporting a $40 million loss in its most recent quarter.

The company, then, was looking for options, and found one in the enterprise market. It introduced a switch that set a new low price point for 10 Gigabit Ethernet.

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Enterprise network equipment buyers recently lost an alternative, but chances are they won’t really miss it.

A year ago Riverstone Networks had been repositioning its carrier-focused gear to accommodate enterprise environments. While network equipment in general had been hurting, it seemed more money was coming from enterprise firms than from service providers, and Riverstone was reporting a $40 million loss in its most recent quarter.

The company, then, was looking for options, and found one in the enterprise market. It introduced a switch that set a new low price point for 10 Gigabit Ethernet.

But then the bottom fell out.

As Network World reported, in April last year the U.S. Securities and Exchange Commission started looking into Riverstone’s accounting practices. As a result, in July the company restated its earnings for fiscal 2002 and 2003, showing that it had overstated its revenue by close to $100 million - not a scandal of WorldCom proportions, but troubling nonetheless. The top managers were out, and NASDAQ de-listed the company.

However, as my colleague Jim Duffy wrote last month, that is all - mostly - in the past. Riverstone is attempting to stand on its feet once again, with new management, an effort to regain its NASDAQ listing, and a new energy.

Gone are the aspirations of selling to enterprise firms, though. Jim reports that Riverstone is focused squarely on Tier 1 carriers instead.

Like I said, enterprise buyers probably won’t miss it.

Read more about lans & wans in Network World's LANs & WANs section.