Oracle did not release financial terms of the agreement to buy Xsigo, a maker of virtualization technology that moves data more efficiently in and out of data center servers, but VMware will pay $1.26 billion for Nicira.

The two acquisitions are a reflection of how seriously major tech vendors are taking the emerging network virtualization technology and its potential to shift network intelligence from proprietary hardware from companies like Cisco and Juniper and move it into software running on commodity systems.

Nicira vs. Xsigo

Besides selling into the same market, though, Nicira and Xsigo have little in common. Xsigo sells hardware that provides input/output virtualization that replaces a server’s multiple Ethernet and Fibre Channel interfaces with a single high-speed Ethernet or InfiniBand link.

Nicira provides an intelligent layer of software that sits on top of data-center servers and manages and controls the resources and capacity of networking gear. Nicira’s technology covers a much broader segment of network virtualization, also called software-defined networks, or SDN.

Because Xsigo and Nicira are so different, some analysts say the acquisitions have little in common. “This won’t effect Juniper or Cisco, and it’s not the same type of news as VMWare plus Nicira,” Andre Kindness, tech analyst for Forrester Research, said of Oracle’s purchase.

Others disagree. Michael Genovese, analyst for equity research firm MKM Partners, sees the acquisition as the start of Oracle getting deeper into networking in the data center. “I call it more of a warning shot than a full battle shot across the bow of Cisco’s and Juniper’s businesses,” Genovese said.

Oracle in Network Hardware

While Xsigo does not make Oracle a competitor in that arena today, the company is giving notice that it could head deeper into the network virtualization hardware business. That would happen If Oracle goes after a bigger fish, such as Brocade or Extreme Networks, Genovese said. And at that point, Cisco and Juniper would have much more to worry about.

“Oracle hasn’t done very well in hardware to date, but they want to be a bigger player in the infrastructure (of data centers),” he explained. “This (acquisition) is somewhat of a networking play.”

Oracle became an enterprise hardware vendor in 2010, when it completed the $7.4 billion purchase of server maker Sun Microsystems. Since then, Oracle has bundled its databases and business applications on Sun hardware to provide all-in-one hardware/software packages.

Xsigo is important to Oracle because customers using its server virtualization technology, called Oracle VM, would benefit from having network connections sitting in a virtualized platform.

“The proliferation of virtualized servers in the last few years has made the virtualization of the supporting network connections essential,” John Fowler, Oracle executive vice president of systems, said in a statement. Xsigo is already used today with Oracle databases in the data centers of HiFX, a foreign-exchange broker; Investec, a specialist bank and asset manager; and Bitbrains, a managed service provider.

What About Cisco and Juniper?

With startups and tech giants leveraging network virtualization to close in on their core businesses, Cisco and Juniper can’t afford to stand still. Juniper has launched its own software-defined networking platform called Q-Fabric and Cisco has invested $100 million in SDN startup Insieme. Cisco Chief Executive John Chambers has said the company plans to eventually absorb the startup, which is led by three Cisco engineers.

However, Cisco and Juniper have not embraced the open standards used in other software-defined networking technologies favored by Web businesses and cloud computing companies such as Google, Facebook, Microsoft, Yahoo and Verizon. In fact, Cisco has been trying to slow the adoption of SDNs by confusing customers with claims that its products are compatible with other SDN technologies, said MKM Partners analyst Genovese.

While that strategy may work in the short term, Cisco won’t be able to stop the movement away from switches and other proprietary hardware that has powered networking for years. “They can’t stop the trend, and the trend is towards programmable, open, software-defined networks,” Genovese said. 

Business customers want more efficient networks in which capacity is maximized and they have control instead of vendors of proprietary hardware. Cloud computing has accelerated the need for such networks and old guard networking vendors will need to adapt or watch their businesses erode.

Oracle expects to close the Xsigo deal in the fall.

Disasters are just that: disasters. Full-blown events that pick up your company and drop it on the ground like it was a toy (sometimes, quite literally). But business continuity is something you need for subtler, yet just as important events, like a downed payroll server, or a file getting deleted that brings your web server to a screeching halt.

For situations like this, business continuity appliances (BCAs) are a very appropriate solution. What BCAs do, simply, is clone whatever servers to which you attach them. If it's a physical BCA, typically you just attach the device to the network, point it at the desired machines and off you go. Virtual appliances, such as those offered by VMware, comport themselves in much the same manner.

BCAs are pretty much set-it-and-forget-it devices, able to clone away with little to no management needed. It's important to remember, though, that BCAs are not meant to be disaster recovery devices. They're meant to handle the foibles in a workplace that can ruin someone's or, in some cases, bring the business to a standstill.

BCAs are located on-site, typically, and as such make poor disaster recovery tools. Businesses who rely on them for this purpose are just asking for trouble. Better to have firm disaster recover plan in place, independent of any BCAs. (See our chart below for some sample products in this space.)

Also, like disaster recovery, the use of BCAs will need to be planned. Since IT funding is limited, you can't just plug these devices willy-nilly into your network. Prioritize what applications and servers needs to have the highest level of business continuity, and implement on those objectives.

Virtual BCAs can, or course, mitigate the costs of any business continuity plan. With lower power, space, and hardware overhead, virtual BCAs may be just the solution your organization needs.

Business continuity, when implemented properly, can be just the thing to get you out of a jam when system availability is a business-critical need, even without disasters.

Brian Madden points out it's an ever-more-complicated concern as the concept of the desktop changes and we grapple with ways virtualization is treated in a security context.

This infographic from Gigya illustrates the ways people identify themselves. We need to think about how identity is associated with our social profiles, how we use virtualization to enhance security and as a way to administer apps, and how those apps are used.

What do you think?