Original URL: http://www.theregister.co.uk/2006/10/11/brocade_mcdata_meeting/

Brocade-McData: nothing to see here, Mr FTC

FAN-tastic future together?

By Christopher Williams

Posted in Storage, 11th October 2006 15:28 GMT

Updated Brocade is not sweating over the Federal Trade Commission's anti-trust investigation of its acquisition of McData and pressing ahead with plans to digest a second third of the storage switch market.

Worldwide marketing VP Tom Buiocchi is unworried by the FTC's interest. The Commission is polling Brocade and McData customers on their concerns over the acquisition. McData customers are giving Brocade an overwhelmingly positive welcome, he reckons.

Once McData is factored in, the combined company will account for more like 70 per cent of the switch business. Brocade execs believe their products are the ones which deserve to be pushed though; they mostly paid $713m for a customer base: the McData name will disappear.

The $100m saving Brocade has promised investors will mostly come from staff. Pre-regulatory approval, a team of 10 consultants has already set about scouting for where the scalpel should fall.

Some customers will have been disappointed, if not at all surprised, over Brocade's decision to ditch McData's flagship i10k director sharpish. The meat from the acquisition of Senera, the product has been a tangible failure; it was the sickness which let Brocade consume McData, rather than vice-versa.

Buiocchi is in Europe this week for the firm's annual sales get-together in Madrid. The firm does most of its business over here, largely thanks its relationship with europhile HP. The target for Brocade's footsoldiers for financial 2007 will be to boost the firm's share of the market by 10 per cent from the third it owns now. A new services division for big enterprise customers is hoped to fuel growth too.

The Brocade board are plotting their assualt on a New World in storage - the file area network (FAN). The NuView acquisition is being positioned as a key piece of a jigsaw puzzle that still requires acquisitions to be a complete, marketable proposition. Cash-rich Brocade reckons it's in a strong postion to stage a land-grab once the hype curve takes off sometime in the next couple of years. ®

Update

Brocade asked us to clarify how it will continue to support products. Go here (pdf) to read the letter Brocade sent all customers after the takeover.