Major players buying a foot in the door

The wide area network (Wan) optimisation market has been driven by acquisitions, according to industry commentators.

"This is a market that has undergone of a lot of transition," Gartner analyst Andy Rolfe, author of the latest Magic Quadrant report on Wan application delivery, said.

"It started in the 1990s with companies like Packeteer and on the whole the market has been driven by small innovative companies."

However, Rolfe explained that these companies had often been acquired to give the major network players a foot in the door.

"Juniper came to this market with the acquisition of Peribit in 2005 and Cisco and Packeteer have both made acquisitions to round out their feature set," he said.

"In the visionaries section of Gartner's magic quadrant there are F5 and Citrix, which again both came to the market through acquisition."

Nigel Hawthorn, vice president of worldwide marketing at Wan services specialist Blue Coat, claimed that his company had not needed to go down the acquisition route too often.

"If you looked at this market 18 months to two years ago there were a lot of acquisitions," he said.

"Juniper, Cisco, Packeteer and Citrix all bought companies in this space, but we did not because we have had this sort of technology for 10 years.

"In our 10-year history we only have made six acquisitions, mainly for technology or engineer experience we did not have rather than market share."

Hawthorn also said that the industry is now coming of age, with the big players becoming established.

"The market is starting to mature and starting to make decisions about winners and losers in this space, which gives end-user customers an easier choice," he said.

"Often it takes a good five years until the top three become defined, but it has happened more quickly because of the growth of the market."

Gartner's latest Magic Quadrant report said that Blue Coat had just moved from third to second position. That has been helped by an overall boost to the market as a whole.

However, Hawthorn dismissed the possibility that Blue Coat is ripe for takeover. "There is no knowledge that the company is looking to be acquired and at this point I do not see the need to be acquired," he said.

"We are a successful, publicly traded company, but of course you should not rule anything out."

Hawthorn said that the biggest interest would come from seeing if a security company decided to get into the Wan optimisation market, as Blue Coat offers both services.

"It will be interesting to see in future if a security company buys a Wan optimisation company to marry these two services together, as we have done," he said.