F5 Buys Assets Of Bankrupt Crescendo Networks


F5 Networks on Monday said it had acquired the intellectual property assets of Crescendo Networks, a move that adds to F5's application delivery networking (ADN) portfolio and takes another ADN competitor off the board.

Terms of the acquisition were not disclosed. Crescendo, which was founded in 2002, is in liquidation proceedings in Israel, where it is headquartered. Crescendo's core development team, which includes fewer than 10 employees, has joined F5 and is already based at F5's regional office in Tel Aviv, according to F5.

Crescendo's specialties are application delivery and load balancing products specific to hardware. F5, which has the No. 1 market share in application delivery controllers, found what one top executive called "some interesting pieces under the hood" when it investigated Crescendo's intellectual property.

"The company went into bankruptcy and we were contacted and we started investigating what they had," said Dan Matte, F5's senior vice president, marketing and business development, in an interview with CRN. "It was mostly stuff like pattern recognition and compression, and we also found a pretty talented core team there as well. That piqued our interest."

According to Matte, F5 will bake some of Crescendo's assets into its Traffic Management Operating System (TMOS), the platform F5 uses for its BIG-IP application delivery products.

"From the outside looking in, my suspicion is the position of offering everything in hardware acceleration made them too slow to be able to react to the needs of the marketplace," Matte said. "The market voted with its pocketbook, and it wasn't the ultimate approach they wanted. A lot of companies come and go with various hardware accelerators over time, and a lot of times you can wind up in the realm of diminishing returns because of the overhead you incur doing that."

The two companies have a small number of overlapping channel partners that F5 will welcome into its Unity partner program, Matte added.

The application delivery controller (ADC) market has been consolidating for several years, with a few dominant players, including F5, and then Citrix, Radware, Cisco and a small collection of others, laying claim to the space. Another recent acquisition specific to ADC technologies was Riverbed's pickup of Zeus Technology in July.

F5 has continued to bolster its channel presence and grow revenue, and is expected to cross the $1 billion mark for revenue in its fiscal 2011, which ends in September.