Intel Moves Deeper Into Network Devices Market

Through a series of acquisitions, Intel Corp. is building a line of network devices. Company officials say the effort is part of its vision to also be a systems-level player with Intel-branded machines.

In February, Intel completed the acquisition of Shiva Corp., and XLNT Networks became a part of Intel in late March.

The Shiva deal enabled Intel to add to its line integrated remote access solutions based on Shiva's direct dial and virtual private networking (VPN) products.

With the XLNT acquisition, Intel gained a technology design center that delivers high-bandwidth, chassis-based switching products. Although the company obtained XLNT a little more than a month after Shiva, Intel was quiet about the purchase. [I have an optional add-back if we need it]

"We have a policy of not preannouncing products. We knew we weren’t going to deliver a product from this acquisition within three months, and since this purchase is basically about the product, we didn’t announce it until we announced the product," says Eric Fullerton, general manager of the network systems division at Intel.

The product obtained from XLNT is now dubbed the Intel 6000 Series Switch, a Gigabit Ethernet switch that was designed for use in the data center.

Intel has another Gigabit Ethernet switch in its fleet, the Intel Gigabit Express Switch, but it is limited to use in smaller companies because it has only seven ports.

"A number of our customers have been asking for a data center switch with more ports, so we bought XLNT to get one," Fullerton says.

Features of the switch, which was announced at the end of last month, include 32 Gigabit Ethernet or 96 Fast Ethernet ports, chassis form factor and two full CPU boards, one of which is idle for fail-over capability.

Paul Strauss, an analyst with International Data Corp. (, points out that Intel’s purchase of XLNT and the release of the Intel 6000 Series Switch is accelerating the company’s plan to build a presence in the switch and router market.

"If Intel wants to become a major player, it must make acquisitions. Building it’s own products and releasing a router every couple of months would take forever," he says.

Strauss also says that for Intel to gain market share in this arena, the company needs to do more than just put products on the market and rely on its brand name.

Intel, for instance, is combining the 6000 Series Switch with its Intel Device View 2.0 software, which manages all Intel networking devices. The Windows- and Web-based software provides front panel views of hubs, routers and switches. It also features automatic device and user name discovery, graphing capabilities and an SNMP trap log.

"Intel Device View is a fine tool that distinguishes Intel’s products somewhat from other products, but they really need more than that to compete," Strauss explains.

Intel’s Fullerton says more products will come in the near future. "There will be approximately 10 [products] that roll out between now and the fourth quarter of this year that give us a more complete line," he says.

Among the anticipated announcements will be a heartier version of the Intel 6000 Series Switch with a secondary 10 MB LAN port, which Fullerton says will enable customers to build network zones for partners and employees to access.

In the next two years Intel will add services and features to these platforms and products. In 2000, for example, Intel plans to add intelligent networking capabilities to the Intel 6000 Series Switch to support customers' evolving networks. Intelligent networking is the ability of the switch to analyze and forward network data packets based on their contents, enabling the switch to more efficiently manage network congestion through bandwidth balancing and dynamic data filtering.

Fullerton says the company also plans to continue purchasing other companies to gain new technologies.

"Intel will likely buy more bleeding edge high-tech firms, rather than struggling router makers," IDC’s Strauss says. "Building market presence will take a while, but we may be able to see more in a year or so."

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