Cisco launches Insieme products, buys out minority shareholders

|About: Cisco Systems, Inc. (CSCO)|By:, SA News Editor

As expected, Cisco's (CSCO +0.9%) Insieme unit has launched a smorgasbord of switches, management software, and APIs the networking giant promises will enable an "application-centric infrastructure" (ACI) that will adapt to the needs of apps and cloud services, and provide an umatched end-to-end view of physical and virtual IT resources.

Cisco has also announced it's buying out the ~15% of Insieme it doesn't yet own. The total purchase price for the "spin-in" could reach $863M.

Headlining Insieme's product launches is the Nexus 9000 line, a group of high-density switches that support 40G links, use both custom ASICs and third-party processors, and promise a high level of programmability via APIs and software extensions.

Perhaps more important, however, is the launch of Cisco's software-based APIC controller, which serves as Cisco's response to software-defined networking platforms (SDN) from VMware/Nicira (VMW - previous) and others. Cisco asserts APIC is superior to SDN alternatives, and trumpets its ability to manage connections for up to 1M networking endpoints; John Chambers has criticized the scalability of Nicira's SDN controller.

Cisco also promises APIC (due in Q2 2014) will use policy profiles to dynamically push out policy changes for apps/services across a network, and provide a comprehensive view of application and network health.

Launch partners include IBM, EMC, NetApp, F5, SAP, and (interestingly) VMware. Cisco has invested heavily in creating a rich software/services feature set for its ACI platform, one that (on paper at least) is differentiated from rivals; time will tell how effective it is in countering SDN solutions threatening to pressure Cisco's margins by allowing commodity hardware to be used.