Intel is buying Barefoot Networks, a challenger to Cisco that had raised over $150 million from giants like Google and Alibaba (INTC, CSCO, AVGO)

intel ceo bob swan

  • Intel is
    buying Barefoot Networks, a Silicon Valley startup with over $150
    million in funding. Terms of the deal were not
    disclosed.
  • Barefoot Networks sells networking equipment, with its
    main differentiator being that developers can write code for its
    hardware that runs directly on the processor — a technical, but
    important, difference that allows for more customization than you
    often find on Cisco or Broadcom gear.
  • The deal comes as Intel faces new challenges, as its
    data center revenues recently faltered for the first time in a long
    time.
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    Insider’s homepage for more stories.

Intel is acquiring Barefoot Networks, a Silicon Valley startup
that had raised over $150 million from giants like Google, Dell
Technologies Capital, Alibaba, and
Goldman Sachs. 

Terms of the deal weren’t disclosed, but Intel says that Dr.
Craig Barratt, the CEO, and his team will be joining the chip giant
after the deal closes, which it expects will happen in the third
quarter of 2019. 

“Upon close, the addition of Barefoot Networks will support our
focus on end-to-end cloud networking and infrastructure leadership,
and will allow Intel to continue to deliver on new workloads,
experiences and capabilities for our data center customers,” Intel
data center boss Navin Shenoy said in a
blog entry announcing the deal
.

Barefoot Networks is a data center networking startup that’s
taking on the likes of Cisco and
Broadcom
with an unconventional approach to the market — an approach that
focuses on Tofino, its proprietary line of processors that power
its lineup of hardware products.  

Specifically, Barefoot boasts that Tofino allows developers to
program right on the processor itself, the lowest technical level
possible, which means that customers can do things with its
products that were never originally intended.

For instance, Barefoot says, a Tofino-powered switch can be used
to analyze and diagnose network traffic as it travels through the
data center, with the developer free to apply fine-tuned controls
over exactly what they’re looking out for, and add to the model as
they go.

A nice talent grab, too

This approach stands in contrast to how it usually works: Cisco,
Broadcom, and the like usually offer software that lets users
install new applications and put their networking gear to use in
new and novel ways — but without giving programmers access to the
processor itself, which limits what can be done with it. 

This philosophy seems to have caught on, however, with
Cisco
and smaller competitors like
Arista Networks
both reportedly deciding to use Barefoot’s
Tofino chips to power some of their newest products.

Also of note is that Barefoot Networks carries something of a
pedigree: Nick McKeown, co-founder of Barefoot Networks, was also a
founder of Nicira, a networking startup that VMware purchased for
$1.26 billion in 2012. 

As for Intel, the acquisition of Barefoot Networks makes a
certain amount of sense, given that both companies are focused on
chips, especially for the data center. However, the deal also comes
as Intel faces a rough patch, with
revenues in its data center segment recently sliding for the first
time in a long time
.

While Intel already sells networking products, this is clearly a
bet that having Barefoot’s technology on its side will open some
doors, and perhaps lead it to a stronger market position. 

SEE ALSO: Intel’s
new CEO used to be CFO, and analysts worry he may not have the
technical chops to lead the company through the stormy waters
ahead: ‘Intel needs a strong technical leader’


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Intel is buying Barefoot Networks, a challenger to Cisco that had raised over 0 million from giants like Google and Alibaba (INTC, CSCO, AVGO)