HP Is Buying Aruba. Who’s Next?

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Sometimes all it takes is a little push. Bloomberg reported yesterday that HP is in talks to buy Aruba Networks for their wireless expertise. The deal is contingent upon some other things, and the article made sure to throw up disclaimers that it could still fall through before next week. But the people that I’ve talked to (who are not authorized to comment and wouldn’t know the official answer anyway) have all said this is a done deal. We’ll likely hear the final official confirmation on Monday afternoon, ahead of Aruba’s big Atmosphere (nee Airheads) conference.

R&D Through M&A

This is a shot in the arm for HP. Their Colubris-based AP lineup has been sorely lacking in current generation wireless technology, let alone next gen potential. The featured 802.11ac APs on their networking site are OEMed directly from Aruba. They’ve been hoping to play the OEM game for a while and see where the chips are going to fall. Buying Aruba gives them second place in the wireless market behind Cisco overnight. It also fixes the most glaring issue with Colubris – R&D. HP hasn’t really been developing their wireless portfolio. Some had even thought it was gone for good. This immediately puts them back in the conversation.

More importantly to HP, this acquisition cuts off many of their competitor’s wireless plans at the knees. Dell, Juniper, Brocade, Alcatel Lucent, and many others OEM from Aruba or have a deep partnership agreement. By wrapping up the entirety of Aruba’s business, HP has dealt a blow to the single-source vendors that are playing in the wireless market. And this is going to lead to some big changes relatively soon.

The Startup Buzz

Dell is perhaps the most impacted by this announcement. A very large portion of their wireless offerings were Aruba. They sold APs, controllers, and even ClearPass through their channels (with the names filed off, of course). Now, they are back to square one. How are they going to handle the most recent deals? What are their support options?

I little thought exercise with my friend Josh Williams (@JSW_EdTech) had a few possibilities:

  1. Dell forces HP to buyout all the support contracts for Dell/Aruba customers. That makes sense for Dell, but it will turn a lot of customers against them, especially when HP lets those customers know the reasons why.
  2. Dell agrees to release the developments they’ve done on the platform to HP in return for HP taking the support business. Quiet and clean. Which is why it likely won’t happen.
  3. Dell pays HP an exorbitant amount of money to take the support contracts. This gives HP the capital to take on all those new support contracts and gives Dell an exit to rebuild. This is probably what HP wants, but could end up sinking the deal.

Dell got burned, plain and simple. They likely could have purchased Aruba months ago and solidified the relationship. Instead, they are now looking for a new partner. However, I don’t think they are going to get burned again. Rather than shopping for a friend, they are going to be shopping for an acquisition. My money has always been on Aerohive. They have an existing relationship. The Aerohive controller-less cloud model fits Dell’s new strategies. And they would be a much cheaper pickup than Aruba. There is precedence for Dell skipping the big name and picking up a smaller company that’s a better fit. It’s a hard pill to swallow, but it gives Dell the chance to move forward with a lasting relationship.

Softwarely Defined

Brocade is a line-of-business partner of Aruba. They’ve only recently gotten involved since Motorola shut down their WLAN business. This is a good sign for them. That means they can exit from their position and not be significantly affected. It does leave them with a quandary of where to go.

The first choice would be to go back to the Motorola relationship, now in the form of Zebra Technologies. Zebra inherited quite a large portion of the WLAN space from Motorola, but they’ve been keeping rather quiet about it. Are they angling to be more of a support organization for existing installs? Or are they waiting for a big splash announcement to get back in the game? Partnering with Brocade would give them that announcement given the elevated profile Brocade has today.

Brocade’s other option would be to go down the SDN road. The plan for a while has been to embrace SDN, OpenFlow, and all things software defined. The natural target for this would be Meru Networks. Meru has been embracing SDN as well as of late. They had a nice event last year showcasing their advances in SDN. Brocade could bolster that SDN knowledge while obtaining a good wireless company that would give them the strength they need to augment their enterprise business.

Permission To Retire

The odd company out is Juniper. I’ve heard that they were involved at first in trying to acquire Aruba, but when you’re betting against HP’s pockets you will lose in the long run. Their other problem is Elliott Management, everyone’s new favorite “activist investor”.

Elliott has made no secret that they see the value in Juniper in the service provider market. As far back as last year, Elliott has been trying to get Juniper to reave off the ancillary businesses, including security, enterprise, and wireless. Juniper has officially ended sales for Trapeze-based products already. Why would Elliott let them buy another wireless company so soon after getting rid of the last one. Even as successful as Aruba is, Elliott would see it as another distraction. And when someone that active is calling the shots, you can’t go against them, lest you end up unemployed.

This is the end for Juniper’s wireless aspirations. That’s not a bad thing, necessarily. This gives them the impetus needed to focus on the service provider market. It also gives them a smaller enterprise switching portfolio to package up and sell off should that pound of flesh be necessary to sate Elliott as well. Time will tell.

Everyone Else

Any other companies with Aruba relationships are either dipping their toes in the wireless waters or don’t care enough to worry about the impact it will have. It will be an easy matter for companies like Alcatel-Lucent to go out and find a new OEM partner, likely with someone like Extreme Networks or Ruckus. Those companies are making great technology and will be happy to supply the APs that customers need. Showing off their technology will also give them great in-roads into customers that might not have been on their radar before.


Tom’s Take

It’s going to be an exciting time in the wireless space. HP’s acquisition is going to start the falling dominoes for other companies to buy into the wireless space as well. When the dust settles, there will be new number twos and number threes in the market. It also clears the middle of the space for up-and-comers to grow. Cisco is going to stay number one for a while, and HP will be number two when this deal closes. But until we see the fallout from who will be purchased and partnered with it’s tough to say who will be a clear winner. But make sure you’ve got your popcorn ready. Because this isn’t over yet. Not by a long shot.

 

A Complicated World Without Wires

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Another Field Day is in the books. Wireless Field Day 5 was the first that I’d been to in almost two years. I think that had more to do with the great amount of talent that exists in the wireless space. Of course, it does help that now I’m behind the scenes and not doing my best to drink from the firehose of 802.11ac transitions and channel architecture discussions. That’s not to say that a few things didn’t absorb into my head.

Analysis is King

I’ve seen talks from companies like Fluke and Metageek before at Wireless Field Day. It was a joy to see them back again for more discussion about new topics. For Fluke, that involved plans to include 802.11ac in their planning and analysis tools. This is going to be important going forward to help figure out the best way to setup new high-speed deployments. For Metageek, it was all about showing us how they are quickly becoming the go-to folks for packet analysis and visual diagramming. Cisco has tapped them to provide analysis for CleanAir. That’s pretty high praise indeed. Their EyePA tool is an amazing peek into what’s possible when you take the torrent of data provided by wireless connections and visualize it.

Speaking of analytics, I was very impressed to see what 7signal and WildPackets were pulling out of the air. WildPackets is also using a tool to capture 802.11ac traffic, OmniPeek. A lot of the delegates were happy to see that 11ac had been added in the most recent release. 7signal has some crazy sensors that they can deploy into your environment to give you a very accurate picture of what’s going on. As the CTO, Veli-Pekka Ketonen told me, “You can hope for about 5% assurance when you just walk around and measure manually. We can give you 95% consistently.”

It’s Not Your AP, It’s How You Use It

The other thing that impressed me from the Wireless Field Day 5 sponsors was the ways in which APs were being used. Aerohive took their existing AP infrastructure and started adding features like self-registration guest portals. I loved that you could follow a Twitter account and get your guest PPSK password via DM. It just shows the power of social media when it interacts with wireless. AirTight took the social integration to an entirely different level. They are leveraging social accounts through Facebook and Twitter to offer free guest wifi access. In a world where free wifi is assumed to be a given, it’s nice to see vendors figuring out how to make social work for them with likes and follows in exchange for access.

That’s not to say that software was king of the hill. Xirrus stepped up to the the stage for a first-time appearance at Wireless Field Day. They have a very unique architecture, to say the least. Their CEO weathered the questions from the delegates and live viewers quite well compared to some of the heat that I’ve seen put on Xirrus in the past. I think the delegates came away from the event with a greater respect for what Xirrus is trying to do with their array architecture. Meru also presenter for the first time and talked about their unique perspective with an architecture based on using single-channel APs to alleviate issues in the airspace. I think their story has a lot to do with specific verticals and challenging environments, as outlined by Chris Carey from Bellarmine College, who spoke about his experiences.

If you’d like to watch the videos from Wireless Field Day 5, you can see them on Youtube or Vimeo.  You can also read through the delegates thoughts at the Wireless Field Day 5 page.


Tom’s Take

Wireless growing by leaps and bounds. It’s no longer just throwing up a couple of radio bridges and offering a network to a person or two with laptops in your environment. The interaction of mobility and security have led to dense deployments with the need to keep tabs on what the users are doing through analytics like those provided by Meru and Motorola. We’ve now moved past focusing on protocols like 802.11ac and instead on how to improve the lives of the users via guest registration portals and self enrollment like Aerohive and AirTight. And we can’t forget that the explosion of wireless means we need to be able to see what’s going on, whether it be packet capture or airspace monitoring. I think the group at Wireless Field Day 5 did an amazing job of showing how mature the wireless space has become in such as short time. I am really looking forward to what Wireless Field Day 6 will bring in 2014.

Disclaimer

Wireless Field Day 5 doesn’t happen without the help of the sponsors. They each cover a portion of the travel and lodging costs of the delegates. Some even choose to provide takeaways like pens, coffee mugs, and even evaluation equipment. That doesn’t mean that they are “buying” a review. No Wireless Field Day delegate is required to write about what they see. If they do choose to write, they don’t have to write a positive review. Independence means no restrictions. No sponsor every asks for consideration in a review and they are never promised anything. What you read from myself and the delegates is their honest and uninfluenced opinion.