Nicira sold for $1.26 billion to VMware

Updated July 23, 2012

On January 10, 2012, I wrote the entry  Network Virtualization (NV), The New El Dorado. I analyzed specifically Nicira and M2Mi (Machine to Machine Intelligence) which were and still are the major players.
According to VMware's Bogomil Balkansky in  Business Insider 

VMware was already creating similar technology to what Nicira was doing. By buying the company it gave itself a big shortcut to own this new multibillion market. 
How the $1.26 billion valuation was decided, I don't know, Business Insider does not know, most people don't know it.
These nice boxes have a value of $1.26 billion

But it proves once again the magic of  Andreeseen Horowitz

My analysis at the time concluded M2Mi  network visualization is a clear working product. I presented more details about M2Mi technology in Why Include the Network Virtualization to the Cloud 

According to M2Mi web site, the company has a stellar list of partners: IBM, Oracle, Cisco, Intel, Ericsson and Joyent 

Does it mean M2Mi can reach the one billion plus valuation too?

Time will tell. IMHO, they have a solid product working, while VMware must polish Nicira to offer the Network Virtualization solution they need as part of their suite of products. Quoting Ben Horowitz
VMware/Nicira are going after the $37 billion data networking market, particularly new data centers being built with cloud computing, says Horowitz. With OpenFlow, they have a good chance to grab a lot of it.
 With this huge $37 billion per year market size, there is plenty of room for other key players. "Cisco has been put on notice, but has also been given a big opportunity to create great new hardware" says  Bogomil Balkansky.  Ben Horowitz adds "technologically, from a programming standpoint, there are more distributing computing guys than networking guys, so it very much fits with VMware, more so than with Cisco.


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