Cisco takes on Fibre Channel storage

Cisco Systems Inc. Tuesday officially announced its entry into Fibre Channel storage with the introduction of a family of fabric switches for enterprise data centers.

The company introduced the Cisco Multilayer DataCenter Switch (MDS) 9000 Family of Multilayer Director and Fabric Switches, a series of four switches ranging from an low-end 16-port switch to director-level swithches with six, nine or 13 slots.

Analysts say the Cisco switches will present formidable competition to Brocade and McData, who each have Fibre Channel switches in the 8-128 port range. The Cisco MDS switches by comparison have 16-768 ports, making them the largest switches in the business.

“All these companies that have great relationships with Cisco and buy their LAN equipment from the company, it seems a natural thing that they would want to go through Cisco for their storage switches,” says an equity researcher at Asensio, in New York. Asensio is an investment bank that creates ‘short selling’ accounts on overvalued companies. “Cisco is a world-class company compared to Brocade or McData.”

The Cisco switches include the MDS 9506, 9509 and 9513. Each switch accomodates blades that contain 16-ports of 1G or 2G bit/sec Fibre Channel and an expansion blade with eight iSCSI or Fibre Channel over IP ports. The MDS 9216 is a one-slot 16-port 1G or 2G bit/sec switch that contains an expansion slot for additional ports.

Cisco claims the MDS products have 1.44 terabits/sec of internal system bandwidth. The Cisco switches support virtual LAN capability, as well as interoperability with other switches in the market. They are managed from a Cisco IOS-like command line interface.

According to the Gartner Inc., the market for Fibre Channel switching is expected to grow from US$1.2 billion in 2002 to $4.3 billion in 2006.

The Cisco MDS 9000 Family system pricing starts at $30,000 and will be available starting in the fourth quarter of this year.

In a related announcement Cisco will acquire Andiamo Systems, the manufacturer of these Fibre Channel switches. In 2001, Cisco entered into agreements with Andiamo under which Cisco was granted the right to acquire the company if it desired. Andiamo was based in Cisco offices in San Jose.

The purchase price Cisco pays for Andiamo will be based on sales of the Fibre Channel switches during the three months preceding the closing, a multiple based on Cisco sales and the market capitalization of the company.

The purchase price could be valued at as much as $2.5 billion. Andiamo has about 270 employees.