Peak Performance

Hebert, COO of Atrion Networking, Warwick, R.I, is one of a growing number of VARs already tapping into a market that&s set to explode, bringing improved application performance and lower costs to customers linking branch offices and remote users back to headquarters over the WAN. It&s an idea encapsulated by a common marketing catchphrase: Providing LAN-like performance over the WAN.

Along with their solution provider partners, vendors are frantically vying for a piece of the action as well, clamoring for a stake of a market that research firm IDC expects to hit $314 million this year and nearly $611 million by 2009.

The latest salvo comes from Juniper Networks, which this week is taking a crucial step toward getting its recently acquired WAN and application acceleration appliances into partners& hands with the launch of a new specialization program around the technology.

Rival Cisco Systems, meanwhile, is also grabbing for a bigger play, creating a new Application Delivery Business Unit last week and launching new products based on technology from several recently acquired optimization vendors.

Solution providers like Hebert are already building multimillion-dollar practices around WAN optimization. Atrion&s WAN optimization product business, based primarily on its partnership with Packeteer, is currently at $2 million, having seen growth of 40 percent to 45 percent year over year for the past six years. Going forward, Hebert expects to hit $3 million to $4 million in sales over the next 12 to 18 months.

At the same time, Atrion is looking to add new product lines to broaden its practice. Hebert is preparing to evaluate offerings that focus on application acceleration, technology frequently lumped together with WAN optimization.

“The whole space is a hidden gem,” Hebert said. “I could walk into 50 customers today that don&t have Packeteer, have never heard of it and have never heard of their competition.”

Suffice it to say, the competition is heating up.

EXPANDING MARKET
What started several years ago with basic compression and caching has expanded into a market swirling with a variety of application delivery, bandwidth management, protocol acceleration, quality of service, traffic shaping and Wide Area File Services (WAFS) technologies, many of which vendors are now tying together into affordable, integrated appliances.

Players such as Cisco, Citrix Systems, F5 Networks and Juniper all snapped up smaller WAN optimization and application acceleration outfits this year, part of the flurry of acquisitions, startup launches, channel program introductions and product announcements in recent months. By completing the training and testing built into Juniper&s new Application Acceleration specialization, partners can achieve authorization to sell the WAN optimization appliances Juniper gained through its July acquisition of Peribit Networks and the application acceleration appliance family it added through its purchase of Redline Networks in May. Juniper has rechristened the products as its WAN Acceleration (WX) and Data Center Acceleration (DX) platforms.

The new specialization will also usher the approximately 150 worldwide partners inherited through the acquisitions into the Juniper fold, said Steve Pataky, director of global channel development at Juniper, Sunnyvale, Calif.

By taking on the new product lines, solution providers can address more strategic issues, raising the level of discussion from solving network problems to solving business problems, Pataky said. “It links them right into critical business process issues,” he said. “It extends their influence beyond networking and security. Now they&re calling on the CEO.”

Cisco&s new acceleration appliances, meanwhile, are based on technology picked up through its acquisitions of FineGround Networks in June and Actona Technologies last year, as well as internal development, said George Kurian, vice president and general manger of the Application Delivery Business Unit at Cisco, San Jose, Calif. “We don&t make business unit decisions lightly, as you can imagine, so it clearly indicates that Cisco is taking an aggressive posture about a market and an aggressive posture about a set of market opportunities and competitors,” Kurian said. “It clearly signals the intent for an aggressive set of product cycles and market-shaping activities.”

Cisco is recruiting partners for its application acceleration solutions. Kurian said many networking partners already have mature applications practices as well. Products coming out of the new unit will aim to bridge the two.

EVANGELIST VARs
Channel players said they are taking leading roles to evangelize the developing WAN optimization/acceleration space and educating customers on its benefits.

“A lot of people don&t know about it until we tell them about it. The sales cycle is long because we have to qualify the product, show them what kind of increase they can expect and show them on one of their links,” said Jay McKeever, principal at Stormwood, an Atlanta solution provider that works with optimization products from Swan Labs, acquired earlier this month by F5. “But once they go through the evaluation, they won&t let us take it out.”

Stormwood expects to hit approximately $200,000 in Swan sales in its first year with the product line, he said.

Driving market growth is the rising importance of applications, not only Web-based ERP and CRM applications but the booming VoIP and video-over-IP markets as well. As these applications reach mission-critical status, customers are starting to hit bottlenecks as they try to push that traffic out over the WAN.

“What&s driving this is the fact that companies are looking to deploy applications in a ubiquitous manner so they are accessible to anybody, regardless of which facility they&re at or if they&re off-site,” said Andrew Segal, president of Vandis, a Juniper partner outside of New York City with a seven-figure optimization business built on Peribit and Redline technology. “When you say you want your applications to be available to everybody, you run into delivery issues.”

Those issues manifest themselves as slow application performance and network congestion—problems some customers mistakenly try to address by adding more bandwidth, solution providers said.

But it&s a tack that rarely rectifies the application performance problem, said Stormwood&s McKeever. “Customers are starting to realize that a bigger pipe doesn&t necessarily mean faster,” he said.

For example, one large pharmaceutical company with international offices bought a full DS3 circuit for $18,000 per month to solve its application performance issues. More bandwidth, however, didn&t cut down on latency caused by the incessant “handshaking” utilized by TCP to transmit data between sites. “When it didn&t help, he came calling,” McKeever said.

Swan&s technology eliminated much of that latency, giving Stormwood a means of solving its new customer&s problem.

DIVING INTO THE DATA CENTER
Customers are also looking at data center consolidation strategies. By moving their equipment out of the branches and into the data center, they gain centralized management over their infrastructure, resulting in lower costs, tighter security and improved regulatory compliance. The trick is to consolidate without losing performance, and WAN optimization is key to that, solution providers said.

“The value proposition is like nothing I&ve ever seen,” said Hayes Drumwright, CEO of Trace3, Irvine, Calif., about products from Riverbed Technology, which Trace3 has been selling for about eight months. Riverbed&s Steelhead appliances combine WAN optimization, WAFS and application acceleration to speed data delivery to branch offices. Trace3 has hired three staff members for its Riverbed business, which is on target to reach at least $1.5 million this year and is likely to grow 100 percent year over year for the next few years, Drumwright said.

“Customers no longer need [local] file servers and Exchange servers. It saves a ton of money,” Drumwright said, noting that customers can typically spend $30,000 to $150,000 per location for local servers.

WAN optimization and acceleration technologies are helping solution providers push into the data center, said Keith Zubchevich, vice president of business development at Riverbed, San Francisco. “Some VARs have been playing in the SMB and branch office itself. Now for the first time they&re key players [in the data center], not the big-iron guys,” Zubchevich said.

DON&T FORGET DISASTER RECOVERY
While large enterprise clients might be primed for data center consolidation, smaller customers can utilize optimization solutions to speed data backup. Customers of all sizes can tap the technology to complement disaster-recovery plans, solution providers said.

“There are a lot of different types of companies from small to large that can benefit from this technology,” said Steve DeNato, sales manager at Vega Business Technologies, San Diego. Vega recently added products from startup Silver Peak Systems to its WAN optimization and acceleration practice.

Silver Peak&s line of NX Series appliances include disk drives to store network data locally as it is requested by branch users. After a file is requested from headquarters the first time and is stored, subsequent requests are served from the local appliance. Through its Network Memory technology, only data that has changed is transmitted from headquarters after that. Customers can see tremendous performance improvements with Silver Peak, depending on the application, DeNato said.

“These next-generation products, that&s where we&re getting attention. Products that just did compression might improve [performance] two times, but with Silver Peak you&re looking at 200 times,” he said. “That&s getting people&s attention.”