From The Expert Feature Article
March 13, 2013

Cisco Invests in a Firm that Could Put it Out of Business

If we were to ask what Cisco’s (News - Alert) biggest business is, you’d likely say routers. But the networking giant is investing in a startup that hopes to put Cisco routers to shame.

Compass (News - Alert)-EOS, founded eight years ago, just launched its first product, a nearly terabit class router that uses optics, actually silicon-to-photonics interconnects, to speed throughput.

The product, the r10004, is aimed directly at MSPs, and is the first in what should be a full line of high performance service provider routers.

What is interesting about the service provider market is that high-end technology often trickles down to the enterprise and sometimes even consumers. This is what happened with Juniper which initially targeted service providers and now goes head to head with Cisco in the general purpose enterprise networking market. That could mean that faster routers will make it to the enterprise, speeding internetworking and the performance of apps accessed from the cloud.

The r10004 is also said to be particularly aimed at software defined networking, or SDN. The simplest way to understand SDN is to think of it as the networking equivalent of virtual servers, storage or PCs; SDN software virtualizes the network, and software defines items such as IP address, protocols, and all the other things that constitute a specific network connection or function.

SDN, like server virtualization, promises to revolutionize the way networks are set up, managed, and how much they cost.

On the MSP side, SDN has the potential to drastically reduce set up time, and eliminate the capital expense of items such as NICs which can now be represented by software.

Many market leaders such as Cisco and Microsoft (News - Alert) invest in startups that are potential competitors. This gives the leader insight into the new technology, and the potential of either licensing or buying the technology outright if it takes hold.

The new router cranks along at 800GPS, but the idea is to build a line of true terabit speed routers. The optics are the key here. Here the company’s technology uses a silicon-to-photonics approach where the photonics provide the blazing speed feeding off the logic of the silicon – and all of this happens with the chips themselves.

The routers are modular so they can be linked and aggregated to boost speed even further.

Edited by Brooke Neuman