Dell Enters High-End Networking with Force10 Buy

Dell (NASDAQ:DELL) is making a play for the high-end data center networking market, announcing plans to acquire Force10 technology in a deal that is expected to close by the end of the summer. Terms of the deal were not disclosed.

Dell said that it would maintain Force10’s existing channel program as it did with previous acquisitions of channel companies, Compellent and EqualLogic.

Dell hinted at networking acquisition plans last year in an interview with Channel Insider.

Dell said that Force10’s networking capabilities complement Dell’s datacenter solutions portfolio, enabling it to offer customers a broader range of enterprise offerings.

Dell’s move comes as the networking market has grown ever more competitive as technology companies seek to become one-stop-shops for compute, storage and networking needs. HP completed its acquisition of networking giant 3Com in April 2010.  And Cisco recently upped its game, offering two distinct lines of switches with one especially designed for the high performance and energy efficiency needs of the data center. Juniper Networks is also considered a giant in the networking space.

Force10 founders came from Cisco but created modular networking systems that are more like those offered by Juniper Networks. 

“Today’s datacenter networks are too complex and require too much manual intervention. What worked in the past is no longer viable in the virtual era,” said Brad Anderson, senior vice president, Enterprise Solutions Group, Dell, in a statement. “Dell’s approach of offering customers open, capable and affordable solutions aligns with Force10’s approach to offering customers new levels of flexibility, performance, scale and automation which is fundamental to changing the economics of datacenter networking.”

Dell said in a statement that the acquisition was just the most recent move it has taken over the past three years to expand its enterprise portfolio to offer customers a complete range of datacenter products and solutions such as an integrated stack of server, storage, networking and services resources.

Force10 is nearly a $200-million company, (based on trailing 12 months revenue) with approximately 80 percent of its business in North America and operating in over 60 countries worldwide. Force10’s Open Cloud Networking is based on open standards, automation and virtualization and is consistent with Dell’s design philosophy, the company said.

Force10’s customers include Web 2.0 and Fortune 100 companies, Internet portals, global carriers, research laboratories and government organizations with some of the world’s most demanding network environments, Dell said.

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