VMware Buys Nicira in $1.2 Billion Embrace of SDN

Nicira-Graphic-470

This graphic provides an overview of how Nicira software creates a network virtualization layer to make it easier to manage virtual machines. (Source: Nicira)

VMware will buy Nicira, a leading player in software defined networking (SDN) for $1.26 billion in a bold move to boost its position in data center networking. Nicira’s software platform manages a network abstraction layer, which lets users create virtual networks that operate independently of the underlying physical network hardware.

The company was founded by key players in the development of the OpenFlow protocol for software-defined networking. Current users of the Nicira Network Virtualization Platform (NVP) include AT&T, DreamHost, eBay, Fidelity Investments, NTT and Rackspace.

"VMware has led the server virtualization revolution, and we have the opportunity to do the same in datacenter and cloud networking," said Paul Maritz, chief executive officer, VMware. "The acquisition of Nicira adds to our portfolio of networking assets and positions VMware to be the industry leader in software-defined networking."

"The combination of Nicira and VMware brings together two pioneering teams, and gives customers the industry leading SDN solution for any cloud environment, on any hypervisor in the enterprise and with service providers," said Martin Casado, co-founder and chief technology officer, Nicira. "The value we bring to customers lies in our open approach and the richness of capabilities in network virtualization."

Nicira has been a leading player in the open networking movement, contributing to networking technology in two open source cloud platforms, OpenStack and CloudStack. VMware said it plans to continue to support these commitments, including the Open vSwitch to connect physical networks and multiple hypervisors.

"I can imagine skepticism as to whether we will continue this substantial embrace of non-VMware hypervisors and clouds,," VMware CTO Steve Herrod wrote in a blog post. "Let me be clear: we are absolutely committed to maintaining Nicira’s openness and bringing additional value and choices to the OpenStack, CloudStack, and other cloud-related communities." Herrod said the company's commitment to openness had been demonstrated in its experience with the SpringSource communityand its stewardship of the CloudFoundry Open Platform as a Service Project.

This acquisition expands VMware's networking portfolio, which includes the VMware vSphere virtual switching, VMware vCloud Director networking, vShieldNetwork and Security software defined services, and the VXLAN protocol to provide a full suite of software-defined networking capabilities.