It may not be the most glamorous, but the LAN switch market has had one thing going for it: it's a market that's growing explosively, fueled by demand for Layer 2 and Layer 3 devices. In the final quarter of 2004, the market was worth $3.8 billion, up 24 percent on the same period last year, according to U.S. network analyst Infonetics.
So Extreme Networks, the Santa Clara, Calif. based LAN switch maker, should be sitting pretty. It is an established player in the market, with several iterations of its products and technology behind it, targeting medium and large enterprises with its high performance LAN infrastructure products.
Its key products are its fixed configuration Summit switches and its BlackDiamond modular switches. The Summit 200 series are low cost Layer 2/3 access switches, the 300 series also include Power over Ethernet (define) and wireless capabilities, and the 400 series are high performance gigabit access switches with 10-gigabit uplink option.
In the higher end BlackDiamond range, the 10808 is a 10 gigabit enterprise backbone switch, and the 8810 is a 10 slot Layer 2-4 10 gigabit switch.
In the past, buyers tended only to look at switch performance, but a number of things have caused this to change, says Mark Slater, technical manager at Extreme. "We are in a converged world with multimedia as well as voice and data being carried over networks, and potential customers have been telling us that it's not just performance that's the number one priority. Availability, security, extensibility, scalability and performance are all number one priorities," he says.
Extreme has a (non-exclusive) partnership with major IP telephony player Avaya, which resells Extreme hardware and jointly develops technology and products, including systems which enable the integrated management of Extreme and Avaya equipment. Avaya has also made a small strategic investment in Extreme.
The key to Extreme's future strategy is its IPv6-ready, modular ExtremeWare XOS operating system. Based on Linux, its individual modules can be stopped, started and upgraded dynamically without interfering with other operations. Each operating system task is run in protected memory space, and if any independent operating system process becomes unresponsive it can be automatically shut down and restarted. The operating system itself can be extended to add new features on the fly, without loading a new OS image.
Extreme's lower end Summit 200 and 300 series devices run on Extreme's more conventional ExtremeWare operating system, and while Slater says this is "more than adequate" for these devices, all new products, including a new Summit X450 series switch, will henceforth use XOS in place of ExtremeWare.
It's possible to talk almost endlessly about individual features of the various models of hardware and the two ExtremeWare operating systems, but it's probably more constructive to look at the big picture: why should anyone consider Extreme gear when there's plenty of similarly priced equipment available from more established vendors like HP and – inevitably – Cisco?
"People actually pay a hidden premium for buying Cisco in upgrades that come along every 6 – 12 months," says Slater. "And with Cisco, all boxes do everything, which you have to pay for, even if you don't need it. We have split the functionality of our OS into base and advanced levels, and you only pay for what you need. All the software is loaded onto the switches, but advances parts are license key enabled."
Features Blackdiamond 10808 Blackdiamond 8810
Max Auto-Negotiating 10/100 Base-Tx Ports N/A N/A
Max Auto-Negotiating 10/100/1000 Base-T Ports 480 432
Max Gigabit Ethernet Ports (Gbic Or Mini-Gbic) 480 224
Max 10 Gigabit Ethernet Ports (Xenpak) 48 36
Form Factor/Footprint Chassis/24ru Chassis/14ru
Total Switching Capacity 1.6 Tbps 800 Gbps, 4.016 Tbps
Programmable ASICS Yes No
Policy-Based Quality Of Service (QoS) Yes Yes
Wire-Speed Layer 2/Layer 3 Switching Yes Yes
Integrated Server Load Balancing No No
Transparent Web Cache Redirection No No
Network Login And EAPS Yes Yes
Access Control Lists Yes Yes
Link Aggregation Yes Yes
Redundant Power Yes Yes
Switch Management Capabilities SNMP, CLI, 4 RMON Groups SNMP, CLI, 4 RMON Groups
Network Management Yes Yes
BGP4, DVMRP, OSPF, PIM, RIP V1/V2 BGP4, OSPF, RIPV1/V2, PIM BGP4, OSPF RIP V1/V2, PIM
More importantly, Slater believes the proof of a LAN switch pudding is in the eating. "We go head to head in network bakeouts and say 'let's put our gear on the bench and show we can outperform others'. We have a high success rate as we outstrip the competition in all four key elements."
The main problem Extreme faces is its lack of appreciable market share. According to U.S.-based analyst Gartner Group, Cisco is the clear leader with 40 percent of units shipped and 70 percent of spending, while Extreme has just 1 percent of shipments and 2 percent of spending. "On the positive side, we think they are a niche player with a good set of products and functionalities, and a good balance of stackable and chassis based products," says analyst Severine Real. "Extreme also has a recognized brand and the Avaya relationship is positive.
"But on the negative side, sales haven't increased recently and there has been a problem with high management turnover. My main concern would be whether the company will be around next year. That is a problem, because if you are worried about that you might as well buy Cisco."
And that, in a nutshell, is the Extreme dilemma. The products are good, the operating system is good, but Cisco is getting stronger in this market every month, and HP is going well, too. The big question is whether there will be room for Extreme in the market in two years' time.