A handful of mergers, acquisitions and auctions changed the WAN optimization market in 2009. Will there be more in 2010?
Happy holidays, readers. It’s the last newsletter of the year, so I thought I’d take a look back at a handful of deals that helped shape the WAN optimization market in 2009. But first, a few questions: Will 2010 be a big year for M&A in the WAN optimization arena? Who will be doing the buying? And what are the big players shopping for? As always, if you have answers or comments, please send them along.
Now on to the deals…
* Compuware nabs Gomez
Announced in October, Compuware’s $295 million purchase of Web optimization specialist Gomez highlights the need for IT pros to see how Web applications are behaving outside the data center – and incorporate that data into enterprise-centric performance management processes. Customers want one source of truth to be able to identify and solve application performance problems, and understand the impact of those problems on the business, said Compuware President and COO Bob Paul when the deal was announced.
“We do great performance monitoring behind the firewall, with some visibility outside through our agentless monitoring. But to actually have real-time data coming in from anywhere in the cloud, in the Internet, down to the last mile of where that application is being used on a mobile device or a laptop or client – it just doesn’t exist today,” Paul said.
(In another application-performance related deal, CA acquired network performance management vendor NetQoS, which has a focus on measuring and monitoring real-time application delivery.)
* Alcatel-Lucent snaps up Velocix
Rich media content delivery is a growing concern for network operators -- including Alcatel-Lucent, which in July announced its acquisition of Velocix. UK-based Velocix (formerly CacheLogic) offers CDN infrastructure and services to media, entertainment, software and telco industries. The purchase of Velocix puts Alcatel-Lucent in a position to help network operators that are struggling to meet customer demands for rich media content delivery, said Melanie Posey, research director at IDC. Alcatel-Lucent will be able to offer “... technology solutions for localized caching, as well as metro and regional/national overlay CDN services that enable ISPs and content providers to establish mutually beneficial commercial agreements,” Posey said at the time.
* Radware’s Alteon bargain
Radware in April completed its acquisition of Nortel's application delivery gear. For the bargain price of $18 million, Radware picked up Nortel’s Layer 4-7 switches for application acceleration and load-balancing, plus certain related intellectual property assets, tangible assets, inventory and service contracts. Radware is continuing to sell – and upgrade -- Nortel’s application delivery gear under the Radware Alteon brand. The $18 million price Radware negotiated is a big drop (to put it mildly) from what Nortel paid nine years ago for the Alteon business: $7.8 billion.
* Riverbed buys Mazu
Riverbed closed its acquisition of Mazu Networks in February, bringing application performance analysis capabilities to its offerings. The acquisition enabled Riverbed to combine its own Steelhead WAN optimization appliances with Mazu’s technology for measuring application usage and performance. Put together, the products could give enterprise IT departments a means to pinpoint where Riverbed’s gear is most needed, and then quantify the benefits of WAN optimization.
* Blue Coat regroups
Blue Coat Systems in November unveiled a restructuring plan and announced its $5.25 million acquisition of S7 Software Solutions, an IT research and development firm based in Bangalore, India. The combination of the S7 Software acquisition and restructuring program is intended to enable the company to more cost effectively develop new products and pursue new routes to market, Blue Coat says. “Together these actions will allow us to invest for future growth while aligning the company’s cost structure to its current revenue level, which should drive higher and more consistent levels of profitability,” said CFO Gordon Brooks at the time.