Broadcom's $80M 'Perfect Storm'
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By Ed Sutherland
Broadcom's purchase of Ethernet switch maker Sandburst for $80 million is "sort of a 'perfect storm' of technology and markets coming together" said Martin Lund, vice president and general manager of the networking switching business unit at Broadcom.
Cable and DSL providers are increasingly turning to Ethernet for the backend of converged networks offering voice, video and data through one broadband pipe.
Switches with traffic management, such as those from Sandburst, provide triple-play services to thousands of subscribers without losing quality of service.
The purchase, expected to be final March 31, makes Broadcom "well positioned to catch the next wave of the burgeoning Metro Ethernet market," Ford Tamer, Broadcom's senior vice president and general manager for the company's networking infrastructure group, said in a statement.
Broadcom, which already offers the Strata XGS III Ethernet switch for enterprise customers, believes Sandburst's HiBeam switches provide Broadcom "end-to-end Ethernet" spanning business and consumers.
"By acquiring Sandburst, Broadcom is poised to accelerate the convergence of triple-play traffic in service provider networks," said Tamer.
Formed in 2000 during the height of the tech crash, Sandburst has attracted many high-profile customers, including HP and Enterasys, Vince Graziani, president and CEO of Sandburst, said.
For consumers, metropolitan Ethernet could mean downloading videos in a fraction of the time it currently takes, Lund told internetnews.com. Today's networks would be crushed under such demands. "This is a bottleneck that must be fixed."
Driven by demand for more bandwidth to serve new broadband applications, the metro Ethernet market could reach $5.5 billion by 2009, according to IDC.
However, look for metropolitan Ethernet first outside the U.S. and Europe with new network infrastructure, according to Graziani.
Metropolitan Ethernet is doing well in Japan, where the networking technology is employed to deliver Ethernet to the home, according to Graziani. Japan's carrier NTT has invested in Sandburst.
Although the metropolitan market won't gather steam in the U.S. until service providers begin upgrading their broadband networks, Graziani said, there are some signs of movement.
Sandburst introduced today its MetroBox-AS access switch. The switch is being offered by Taiwanese Accton Technology Corporation to deliver metro Ethernet to multi-tenant units and for triple-play services.
That announcement follows news that Sandburst rival Atrica inked a deal to provide Ethernet boxes to NYC-area cable provider Optimum Lightpath.