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"In a superficial first analysis, you could say networking vendors will be worried," he said. "But when VMware first came to market, there were similar concerns about our technology destroying the server business. But since then, we've seen a lot of development in server technology. Look at multi-core processors. Before virtualization, customers didn't know how to use them. Intel has added virtualization technology to its processors. And Cisco UCS servers came virtualization technology."
Balkansky said he expects the same thing to happen with networking.
Virtual machines can currently be moved between physical hosts via top-of-rack switches with technologies such as vMotion, he said. "With network virtualization, you can do it on a much larger scale, from one rack to another or from data center to data center," he said. "To do that, you need higher performance switches. So this will generate a new generation of networking technology with more powerful routers and switches."
PUBLISHED JULY 25 Solution providers said that the acquisition will create new networking opportunities in the cloud.
Steven Reese, vice president of collaboration and security architectures West at Presidio, a Greenbelt, Md.-based solution provider, said in an e-mail to CRN that he believes the acquisition will undoubtedly create some great opportunities for manufacturers to take transparent networking to a new level.
"With manufacturers like Cisco moving toward SDN (software-defined networking), there is an opportunity for some really unique integrations if these manufacturers are willing to share APIs. It will be interesting how VMware looks at partnering Nicira with the incumbent physical network manufacturers to create a true next generation network strategy. Time will tell how this will all end up, but I think customers will really dictate what the end result will be," Reese wrote.
VMware is using software to define data centers and the cloud, and networking technology already has a strong software component, said Dan Weiss, CEO of Varrow, a Greensboro, N.C.-based solution provider and partner to VMware and Cisco.
"It will take time, but people want everything to be turned into a software plug," Weiss said. "That means lots of opportunities for OEM agreements."
Even as networking moves towards SDN, it still requires some type of physical device, Weiss said. "Cisco has software," he said. "But look at the customer. Who would customers go with first in their networking, Cisco or VMware? SDN extends to Cisco, Juniper, Hewlett-Packard, and any companies that want to be in this market."
Weiss said he cannot imagine VMware going out and damaging its relationships with networking vendors with its own technology. "Nicira will provide more functionality for VMware, and better partnerships with networking companies in the future," he said.
Another solution provider, who declined to give his name, said a lot of people at his company have been looking Nicira's SDN technology and how to work with it.
"Moving it under VMware's control will make it a lot more clear how we can work with it," the solution provider said. Often these smaller companies are hard to work with. VMware will make it easier."
That solution provider said he expects great things from Nicira under VMware. "We were expecting this to become the VMware of networking," he said. "Now it is VMware."