Start-Up Plans to Disrupt Networking Giants

Excerpt from an article in The New York Times
Tuesday, February 07, 2012

Start-Up Nicira Plans to Disrupt Networking Giants 

By QUENTIN HARDY

SAN FRANCISCO - Google, Facebook, Microsoft and Amazon already turn millions of computers into single clouds of supermachines, managing the flow between personal computers of cat videos, e-mails and the president's recent chat on Google Plus.

Millions more of these computer servers figure out what to sell you while you browse the Web. These global systems work only because of something called virtualization, a kind of software that tricks one server into doing the tasks of several. The cost savings and flexibility revolutionized the data management business, since virtualized machines can run on cheap semiconductors.

High-price networking gear still ties together most data centers, however. Companies pay for it because managing data traffic is tougher than mere computation. Now a small company called Nicira, along with a few other scrappy players, is pursuing what is called software-defined networking, which should cut costs and make equipment more efficient.

A software-defined network, which originated in government spy agencies, is similar to server virtualization, and because of that is quite likely bad news for networking equipment makers like Cisco and Juniper Networks. If proprietary systems can be mixed together and cheap chips used in place of custom semiconductors, prices for the gear would most likely will drop.