Brocade Drops Network Adapter Business, Sells to QLogic

Brocade (BRCD) is getting out of the network adapter business and will focus its technology and product attentions on software-defined networking (SDN) and data center fabric. The networking company sold its network adapter business to QLogic (QLGC).

In an attempt to refocus on markets where its executives clearly believe it can have a stronger impact, Brocade is looking to shed lines of business that generate up to $100 million annually. The network adapter business is only one of those, so there may be similar announcements coming from Brocade in the next few months.

According to Brocade, the network adapter business was fairly small. It also chose not to disclose the deal made with QLogic for the business unit.

Included in the deal are:

“This transaction continues the execution of our business strategy, which will further enable Brocade to focus on core networking technologies in the data center in order to better serve our customers and partners and to drive better value for our shareholders,” said Ken Cheng, CTO and vice president of Corporate Development and Emerging Business at Brocade, in a prepared statement. “This transaction also benefits our customers through the two companies firmly committing to the success of the current Gen 5 Fibre Channel technology as well as Gen 6 technology, which is now in development.”

It looks to be a cutting of the chaff from the wheat. Brocade is removing lines of business that aren’t hitting the kinds of revenue targets it would like and refocusing on technologies that are currently receiving plenty of market hype and will, in time, be big business for the winners.

SDN is one of those markets. Brocade’s minds believe that SDN is going to pick up significantly this year, and it looks as though the company is busy planning for that eventual outcome.