Brocade makes wireless play with $1.2bn Ruckus acquisition

Networking and storage specialist Brocade has confirmed it will fully acquire wireless vendor Ruckus for $1.2 billion, making a concerted move into the service provider networking arena.

Brocade already boasts a broad portfolio of network services and data centre storage solutions, although primarily enterprise focussed. While the pervasion of NFV within telecoms has allowed Brocade to offer virtualized IP core functions as a business unit, the acquisition of Ruckus should bolster its wireless networking offerings substantially.

COO of Ruckus Wireless, Dan Rabinovitsj, told about the intricacies of the deal, and the overall strategic purpose for the acquisition for both Brocade and Ruckus.

“Both companies need each other, in a way,” he said. “Brocade needs a wireless story, which is extremely important in today’s market if you’re going to be in the networking business. And Ruckus needs to say it can look in from the edge all the way back through to the switching and IT infrastructure into the data centre. The two are extremely complimentary from a tech perspective.”

Speaking about the strategic positioning of the deal from a Brocade perspective, Rabinovitsj explained the need for an expansive tech proposition for the wireless industry, without going so far as to use the phrase “end-to-end”.

“It’s really hard for companies to address the service provider market without having a full complement of capabilities,” he said. “The reality is we carved out a number one position in the SP Wi-Fi business, and we want to continue to grow there. For Brocade, they’ve already got deep relationships with service providers in the data centre space, so that’s not what they’re missing. But with a wireless offering and everything that’s relating to network functions virtualization and SDN at the edge, it’s far better to have an entire solution that runs from the data centre to the edge. I’ll avoid saying end-to-end, but all of those capabilities have to be there.”

According to a Brocade statement the acquisition will open up new opportunities in 5G, IoT, Smart Cities and LTE/Wi-Fi convergence. With all the tech buzzword boxes suitably ticked, Brocade said the ultimate aim is to innovate edge service creation and delivery.

The IP architecture for which future businesses and consumers will rely for their entire digital lives underpins the entire strategic decision for Brocade, according to CEO Lloyd Carney.

“This strategic combination will position us to expand our addressable market and technology leadership with Ruckus’ fast-growing wireless LAN products, and supports our vision to deliver market-leading New IP solutions that enable the network to become a platform for innovation,” he said. “We believe that combining our portfolios will provide significant benefits to our customers and will enable us to accelerate our growth and value creation.

The final branding and positioning of Ruckus Wireless after the completed acquisition is yet to be confirmed, according to Ruckus COO Rabinovitsj.

“The one thing we know is that we’ll be a business unit reporting into the CEO of Brocade,” he said. “The discussion around branding in the future is yet to be determined, but there’s a clear understanding that Ruckus has a nicely chiselled brand in the SP space. It’s important to know, regardless, that the approval of the deal by the Brocade board did not require the elimination of any jobs on the Ruckus side, and the intention is to keep the company intact.”

Brocade claims the completed transaction will see the combined company become the top storage area networking and Wi-Fi vendor in the US and EMEA; while the final deal is subject to approval from the relevant competition and antitrust authorities in the US and various global territories.

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