Application delivery controllers (ADCs) are Layer 4-7 devices that evolved out of the load balancer industry. ADCs optimize applications deployments within a data center, performing a variety of tasks such as SSL offloading, web application firewalling, and application acceleration. Websites use them extensively but enterprises also make broad use of them for big and complex enterprise applications like ERP systems.

Gartner’s Magic Quadrant (MQ) is a market assessment device used to evaluate both the ability of vendors to build effective and innovative products (completeness of vision) and their ability to market and sell those products (ability to execute).

The Leaders (high ratings in vision and execution): F5 Networks, Citrix Systems and Radware

F5 and Citrix remain leaders in the application delivery controller (ADC) market for yet another year. Citrix drew praise for being a leader in virtualized ADCs and its rich features and deep understanding of applications.  Gartner sees good potential for Citrix to bundle its virtual ADC with its Xen hypervisor products.

F5 continues to dominate in both technology and sales. It has strong customer loyalty, due in part to its DevCentral user community portal and its iRules scripting language and iControl API — technologies that have made F5′sADCs extremely customizable. Gartner cautioned that F5 is very reliant on hardware innovation; whereas competitors are doing more in software. Some vendors, like Zeus Technology, doing nothing but software, relying on industry standard servers for deployments of their technology. Gartner claims F5 also has limited features and functionality in its lower-end hardware, forcing smaller customers to spend a lot of money to get the features they want.

Radware, meanwhile, has climbed into the leader category from the visionaries box, thanks in part to the successful integration of its Nortel Alteon acquisition.  Analysts praised Radware’s vision for how ADCs fit into virtualized and cloud architectures.

Visionaries (high rating for vision): Zeus Technology, Strangeloop, ActivNetworks and Aptimize.

Here’s where things get a little interesting. Gartner has added three newbies to the MQ this year and all of them are here in the visionaries box, joining the software-based ADC vendor Zeus Technology. ActivNetworks, Aptimize and Strangeloop are the new players here and each of them has a unique specialty (Technically, Aptimize is straddling the line between visionary and niche player).  ActivNetworks sells a virtual ADC that optimizes mobile traffic and video streaming.  Aptimize focuses on messy, browser-based apps. Strangeloop specializes in HTTP optimization. Gartner says these new vendors, particularly Aptimize and Strangeloop, are often deployed in tandem with ADCs from one of the more advanced vendors on the market.

Challengers (high rating for execution): None, same as last year.

Niche Players (low ratings for vision and execution, but generally considered good and viable options for specific environments): Cisco Systems, A10 Networks, Brocade, Array Networks, Barracuda Networks and Crescendo Networks.

Despite holding the number two market share position, Cisco continues to remain in a niche player. Gartner says Cisco makes most of its money here in straightforward load balancing and it has limited application expertise compared to other vendors, which inhibits its ability to help with complex applications.

Back in 2000 Nortel bought application delivery switching vendor Alteon for about $6 billion in an effort to keep pace with rival Cisco. Nine years later, Nortel is bankrupt and it is trying to sell off assets as it restructures itself. Nortel announced last week that Radware was buying the asseets of the Alteon business, but neither company announced the value of the deal. Today the Ottawa Citizen published the numbers, based on a filing in U.S. bankruptcy court.  Radware will pay Nortel around $17.5 million. That’s less than 3% of what Nortel originally paid for the company.