By Andreas M. Antonopoulos, Nemertes Research Inc.

June 3, 2005

On May 26, Cisco Systems (Nasdaq: CSCO http://www.cisco.com/) announced that it will pay $70m to buy privately held FineGround (http://www.fineground.com/), a vendor of Web application-optimization products. This acquisition will further strengthen Cisco’s position in the enterprise data-center space.

FineGround builds appliances for the acceleration and performance-optimization of Web applications and file services, and they leverage functions such as server offload, network-latency control, and bandwidth reduction (compression) to optimize the delivery of Web-based applications. The appliances sit in the data center, both physically close to the application and logically higher in the protocol stack, concentrating on layer-7 optimization.

A more recently launched product, the VelocityFS appliance, delivers Wide Area File Service (WAFS) that lets remote and branch workers access files in the data center at a performance level that is close to LAN performance. The VelocityFS appliance, as with other FineGround appliances, resides only in the data center (ie, no “paired” appliance is required on the other end), allowing enterprises to consolidate resources in the data center and reduce the number of remote systems that have to be managed.

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