The Rayno Report held another one of our social events on CrowdChat, LinkedIn, and Twitter on July 27. The topic was #NFV, or Network Functions Virtualization. The event covered the emergence of NFV, which will make it easier for service providers and cloud providers to deploy new communications and network services by deploying software on industry-standard hardware. 

NFV is attractive because it can lower the capital expenditures (capex) and operating expenditures (opex) of service providers looking to deploy new services. Instead of building purpose-built infrastructure, as has been the practice for years, they can deploy commodity servers and swap services in and out via software only. This means that just about any service requiring a specialized hardware appliance could be moved into the cloud as a software service.

This entry was posted on Tuesday, July 21, 2015 at 14:27 pm and is filed under Infrastructure & SDN.
Keywords: NFV, Cyan, CenturyLink

Plexxi Inc., a Nashua, N.H.-based startup that is building a Software Defined Networking (SDN) optical switch, is back in the spotlight with the release of a new product, the Plexxi Switch 2. With the Switch 2, it's doubling down on its unique optical architecture for connecting data centers.

The Switch 2 is fun because it stirs up many of the existential questions about SDN, data centers, and whether a plucky startup can take down a giant networking company like Cisco (Nasdaq: CSCO) or Arista (Nasdaq: ANET). Such questions include: Can an optical switch also be SDN? Can you skip "leaf-and-spine" architectures? Should SDN controllers be open or proprietary? ...and many more fun puzzles for networking geeks.

This entry was posted on Wednesday, July 15, 2015 at 14:35 pm and is filed under Infrastructure & SDN.
Keywords: Plexxi, Arista, Cisco, Leaf and Spine, Optical, Data Center, Cloud

Last week Cisco (Nasdaq: CSCO) announced it is buying OpenDNS for the healthy price tag of $625 million. It's nice if you can get it. The deal shows Cisco realizes the urgency of being positioned in security and, especially, having a cloud security solution. 

Cisco was already an investor in OpenDNS, which protects against malware, botnets, and phishing at the Domain Name Server (DNS) layer of the Web. Combined with Cisco's purchase of SourceFire in 2013 for $2.7 billion and you have a $3.5 billion investment in emerging security technology. In the last year, Cisco has also purchased malware analysis business ThreatGRID and security advisory firm Neohapsis. 

Industry sources said they were surprised by the size of the deal. OpenDNS is believed to have revenues in the $100 million range, giving it a valuation more than 6 times revenues. It's clear that security startups around the world are celebrating their healthy bump in value after this deal. 

So the big question: What does this mean for Cisco's security strategy, and where is it going? Security is a huge opportunity for new CEO Chuck Robbins, and this is his first big deal. Will security be Cisco's big focus? 

This entry was posted on Thursday, July 09, 2015 at 14:20 pm and is filed under Infrastructure & SDN, Applications.
Keywords: Cisco, Security, OpenDNS, Chuck Robbins

Amazon and Microsoft's Azure are the clear leaders in offering cloud services to enterprises, according to the results of a customer survey released by investment bank Cowen and Company. 

Amazon's AWS was the overall leader among various criteria for cloud services, including highest share of budget (27%), while Azure was close behind (23%), according to the Cowen survey, which targeted 200 cloud customers. Azure had a slight edge in usage, with 45% of the respondents using the services vs. 44% for AWS.

The Cowen analyst team concluded the results are positive for Amazon (Nasdaq: AMZN), Microsoft (Nasdaq: MSFT), Red Hat (NYSE: RHT), VMware (NYSE: VMW), and Rackspace (NYSE: RAX), but negative for IBM (NYSE: IBM). For Google (Nasdaq: GOOG), it sees the results as mixed. Rackspace stood out as well positioned to gain spending in a variety of areas. 

This entry was posted on Tuesday, July 07, 2015 at 14:01 pm and is filed under .
Keywords: Cloud Services, Security, Amazon, Microsoft, Azure, AWS, Rackspace

Software-Defined Networking (SDN) startup Pica8 has won a deal to supply white-box switches to build the network fabric at the TouIX Internet exchange, based in Toulouse, France. The Pica8 white boxes will replace Cisco equipment in the deal, according to a TouIX technology expert.

It's a small deal, but it may be indicative of SDN's appeal to Internet exchanges. Marc Bruyere, researcher at LAAS CNRS and one of the technology developers for TouIX, said Pica8's Open Flow-based switches provided better performance, cleaner management, and the capability to enable Web-based provisioning for customers. 

"We really are vendor agnostic, that's what we wanted," said Bruyere in an interview with The Rayno Report. "Now we can buy from Pica8, Quanta, and other [white-box vendors] in the future."

This entry was posted on Tuesday, June 30, 2015 at 16:51 pm and is filed under Infrastructure & SDN, Investing.
Keywords: White Boxes, Cisco, Pica8, TouIX, Interent

Arista Networks (NYSE: ANET) founder and CEO Jayshree Ullal has been selling Arista shares at a ferocious pace over the last six months, dumping about $60 million worth of stock, or 7% of her entire position in the company, since the beginning of the year. 

The sales have come during a powerful rally in the stock over the last two months. Arista was trading above $80 recently, after bottoming out around $60 in February. Shares slumped last fall and winter after Arista's chief rival, Cisco Systems, announced it was suing Arista for intellectual property theft. Ullal is a fomer Cisco executive who left the networking giant to start Arista.

The lawsuit, a rare one for Cisco, weighed on Arista shares for several months before investors started to shrug it off. Many Wall Street analysts have built in several millions of dollars in quarterly legals costs and an eventual settlement on the lawsuit, which might be in the triple-digit millions, in light of simliar technology lawsuits. A settlement in the hundreds of millions would have a signficant earnings impact on Arista but would not put it out of business. The company holds $500 million in cash and is profitable. 

This entry was posted on Wednesday, June 17, 2015 at 21:03 pm and is filed under .
Keywords: Arista Networks, Jayshree Ullal, Cisco Systems, Stocks

Silver Peak Systems, which has been known primarily as a Wide-Area Network (WAN) optimization player over the past few years, is adding Software-Defined WAN technology to its portfolio with a new SD-WAN controller and networking overlay product.

Earlier this week, the company introduced Unity EdgeConnect, a software product that allows enterprise customers to secure and optimize broadband Internet as a substitute for more expensive leased lines, such as those using Multiprotocol Label Switching (MPLS) technology.

Unity EdgeConnect creates a virtual network overlay, and it works with existing network infrastructure. Customers can use Unity EdgeConnect to secure and optimize broadband Internet as a WAN technology or employ a hybrid WAN approach that leverages both MPLS and broadband Internet. 

This entry was posted on Wednesday, June 17, 2015 at 13:47 pm and is filed under Infrastructure & SDN, Applications.
Keywords: Silver Peak, David Hughes, WAN Optimization, SD-WAN, Cloud WAN, Cloud Networking

Earlier this week at Apple’s Worldwide Developers Conference in San Francisco, Apple unveiled its long-rumored reboot of Beats Music. In some respects, this day was one that many who have followed streaming music since its inception have anticipated and dreaded.

Many have waited for the day Apple, with its juggernaut marketing muscle and insatiable appetite to create a market out of thin air, got behind subscription music. Many posited that this would be the day that streaming music would finally come of age.

In the 13 years since Rhapsody introduced the first licensed subscription service, the product has been on the fringes of the mainstream. Even today, only 41 million people around the world pay for an on-demand music service.

Why the dread? Many in the business who have been here since the beginning felt that the day Apple came into the market, it would be game-over for them. Many believed that powerful Apple would take all the oxygen out of the market and there would be no room for other players in the field.

This entry was posted on Friday, June 12, 2015 at 14:34 pm and is filed under Digital Media, Investing.
Keywords: Apple, Apple Music, Jimmy Iovine, Rhapsody, Streaming Media

Software-Defined WAN (SD-WAN) startup Viptela has landed Singapore Telecommunications Limited (Singtel) as a customer, where Viptela's technology will be used to deliver the Singtel ConnectPlus SD-WAN service.

The two companies say that "multiple enterprises" are in pilot deployments of services using Viptela technology, called the Secure Extensible Network (SEN), which enables customers to manage VPNs and applications policies through a combination of software and controllers. Singtel's ConnectPlus service will be available in Asia-Pacific, Australia, Europe, and the United States.

Viptela was profiled in our "Future of Cloud WAN" report, released earlier this year for the bargain price of $650. The company has raised $33.5 million from Sequoia Capital. More than $360 million has been invested in cloud WAN startups, according to our report.

This entry was posted on Wednesday, June 10, 2015 at 13:44 pm and is filed under Infrastructure & SDN, Investing.
Keywords: SD-WAN, Cloud WAN, Viptela, Singtel, MPLS

This week in San Francisco, Apple is running its Worldwide Developers Conference, which affords it even more ways to hog the technology news cycle by announcing many new tech developments. Let's recap some of what's going on.

Many pundits already accuse Apple's WWDC as being a bit dull, filled with copycat moves such as offering multitasking on iPads (yawn). But, of course, the real news is the debut of the Apple Music subscription streaming music service, in a bid to take down market leader Spotify.

The Apple Music service launches on June 30 and will cost $9.99 a month, the same price as Spotify's ad-free subscription service. Spotify raised $400 million earlier this year at an $8 billion valuation, so it is currently perceived as the leader in music streaming. As we reported in February, Spotify announced that it had reached 15 million paying subscribers and 60 million total users in January of this year. 

This entry was posted on Tuesday, June 09, 2015 at 14:24 pm and is filed under .
Keywords: Apple, Apple Music, Spotify, Jimmy Iovine, Apple IOS
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