Intel invests about $6.5m on SDN firm Big Switch Networks

By Sooraj Shah
11 Feb 2013 View Comments
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Semi-conductor giant Intel has invested about $6.5m (£4.1m) in software-defined networking (SDN) firm Big Switch Networks, as it looks to diversify its portfolio away from PCs and servers.

The investment by Intel comes in Big Switch's Series B funding round, which now brings the total amount raised to date to over $45m (£28.6m) from investors including Goldman Sachs, Index Ventures, Khosla Ventures, Redpoint Ventures, among others.

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"Dramatic changes in enterprise and service provider datacentre networks require novel networking architectures and products," said Guido Appenzeller, CEO and co-founder of Big Switch Networks.

"We are excited to have Intel Capital as a strategic investor to help deliver next generation SDN solutions to the market," he added.

SDN solutions are designed to improve and simplify networking. For example, the technology uses software to direct network traffic instead of expensive and hard-to-use network switches - in this way the services controlling the network layer are abstracted out.

Big Switch is a start-up that is competing in a space overcrowded with legacy providers such as Cisco, and VMware, who acquired SDN provider Nicira last summer for $1.26bn (£802m).

Meanwhile, the likes of HP, Juniper Networks and start-ups such as Plexxi also offer SDN solutions.

For Intel, the investment shows the firm's new strategy of reaching out to areas beyond its core  chip-making business.

"Datacentre operators need programmable and cost-effective merchant silicon-based networking architectures to meet their datacentre economic and operational objectives," said Bryan Wolf, managing director of Intel Capital.

"At Intel Capital, we're looking for companies creating the most disruptive datacentre solutions, and Big Switch Networks' Open SDN product suite is a leading solution in datacentre network virtualization," he added.

Intel has built up its networking portfolio in the past few years. In July 2011, it agreed to acquire network switch specialist Fulcrum Microsystems, while in January the firm announced it would acquire networking company QLogic's InfiniBand business assets for $125m (£79.6m).

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