Nortel Spin-Off Signs Deal With IBM To Compete Against Cisco


As a result of the agreement, BNT, which was formed in 2006 as a spin-off from Nortel, gains access to about 40,000 patents from IBM, including those related to cloud computing and virtualization technologies, said Vikram Mehta, CEO of the Santa Clara, Calif.-based company.

Mehta said the agreement is a big move for both companies in the wake of Cisco's unveiling of its Unified Computing System, which is aimed at combining server, storage and networking resources into a single platform.

"You've seen Cisco's news," he said. "Cisco with everything, the Cisco switch and Cisco system. IBM gets technology from us that lets it compete against Cisco. It ensures that customers are less likely to get locked into Cisco technology."

BNT is currently the third-largest provider of 10-Gbit Ethernet switches in terms of ports shipped behind Cisco and ProCurve, Mehta said. He said it is currently only 20,000 ports behind ProCurve, citing the analyst firm Dell'Oro Group.

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Mehta said that IBM is also now selling his company's switches under the BNT name instead of the Nortel name as was previously the case.

BNT sells its switches only through indirect sales channels, mainly to solution providers via reseller relationships with system vendors such as IBM, Hewlett-Packard, NEC and Verari Systems. The company in February signed a distributor relationship with Bell Microproducts, Mehta said.

Next month, BNT plans to be the first switch vendor to introduce a lossless Ethernet converged network switch for blade environments, Mehta said. Such a switch is designed to work with IP and storage networking simultaneously.

Anthony Lobretto, president of Hailer IT Solutions, a Nutley, N.J.-based networking solution provider, said that 10-Gbit switching has become quite a good niche market, and that BNT has proven its ability to compete against its larger peers.

While many customers feel that BNT seems like a startup, they still buy the vendor's switches because of the performance, Lobretto said.

Hailer has not been an IBM partner in the past, but that is changing, Lobretto said. "We're now signing with IBM as a reseller," he said. "We want to get into the server business. We've been passing up on a lot of customer opportunities."