Posted by: Shamus McGillicuddy
Expand Networks, Networking Channel, Riverbed, WAN optimization
Riverbed Technology is in talks to buy rival WAN optimization vendor Expand Networks for $30-$40 million, according to Globes Online, an Israeli business news site (Expand lists Roseland, N.J., as a corporate headquarters, but it is very much an Israeli company, with most of its employees in Tel Aviv and the majority of its most senior executives Israeli. So naturally an Israeli business site would have the inside scoop here). The site notes that Expand has spoken to many potential suitors. Don’t be surprised if Cisco, Juniper or F5 tries to head Riverbed off here and try to grab Expand’s technology.
If the Riverbed-Expand deal happens, Riverbed and Expand partners should watch carefully how Riverbed incorporates Expand’s technology into its product portfolio. Certainly Riverbed would prioritize the integration of Expand’s remote and virtual desktop acceleration capabilities into its Steelhead appliances.
Riverbed might also try to integrate Expand’s vision for software-only WAN optimization appliances. Riverbed’s approach focuses more on having physical boxes between each location, although its Steelhead Mobile technology has departed from this vision, allowing enterprises to deploy acceleration software on end user devices.
This deal would mark further consolidation in the WAN optimization market. Expand, itself, snatched up software-only WAN optimization vendor NetPriva in 2008. Another WAN optimization rival, Blue Coat Networks, bought Packeteer, a WAN optimization and traffic prioritization vendor in 2008. Furthermore, Riverbed has been open to expanding its business through acquisition recently, acquiring network performance monitoring and network behavioral analysis vendor Mazu Networks last January.
Analyst firms Gartner and Forrester Research consider Riverbed and Expand both as technology leaders in the WAN optimization market. While Riverbed boasts strong brand recognition, a broad range of acceleration techniques (including encrypted MAPI, CIFS and HTTPS), its has lacked a strong story in virtual desktop infrastructure (such as RDP and Citrix).
Meanwhile Expand has long specialized in Citrix and RDP acceleration. Expand’s biggest challenge has been achieving profitability. The company has raised more than $80 million in venture capital, and yet Riverbed is kicking the tires at $40 million. If