As part of its plans for building faster, more powerful networks, Cisco Systems said today it will buy Growth Networks Inc., a privately held company that has developed an Internet switching fabric. The all-stock deal is valued at $355 million.
Cisco says it will use Growth Networks' technology, which can help handle increasing levels of network traffic, in its next-generation infrastructure for service providers. The deal, which is subject to various conditions, is expected to close by July.
Growth Networks' Internet switching fabric is a new category of networking silicon that interconnects high-speed switchers and routers, enabling networking infrastructures that can scale from gigabits to terabits, according to Cisco. "Within 2 to 2-1/2 years, service providers are expecting to see devices that can scale to the hundreds of gigabits to the terabit range in a single device," says Tony Bates, VP of engineering for Cisco's public IP carrier systems group. Analysts agree that demand for higher scaling capacity and speed will drive the next generation of networking products. "Cisco and other networking companies need to scale up their systems to handle the capacity that's available on optical networks," says Steve Byars, principal analyst with networking consulting firm Current Analysis.
Growth Networks' 53 employees will join Cisco's public IP carrier systems group.