F5 Receives Plaudits as VMware Acquisition Rumor Surfaces

F5 Networks, the company that wrote the book on how to challenge and beat Cisco in a network-equipment market, is getting well-deserved plaudits on a couple fronts today.

First, F5 has been acknowledged by Gartner, Inc. as the worldwide market-share leader, based on revenue, for Application Delivery Controllers (ADCs) in the first calendar quarter of 2008. In addition, Gartner has placed F5 in the leaders quadrant of Gartner’s 2008 Magic Quadrant for Application Delivery Controllers.

Elsewhere, Joe Panettieri, writing at Seeking Alpha, provides his interpretation of why F5 has succeeded where so many other companies have failed: beating Cisco Systems in the world of computer networking.

It’s an interesting take, though I think Panettieri places too much emphasis on F5’s online community and not enough on the company’s channel strategy and its unswerving focus, from product management to sales, on understanding and properly prioritizing and addressing customer requirements.

F5, in taking command of the application-delivery networking space, does far more right than wrong, and Panettieri is right about how F5’s laser-sharp, deep-and-narrow approach has successfully countered Cisco’s broader-based strategy and product portfolio in the hotly contested market segment where the two companies have gone head to head.

Speaking of F5, a new rumor is making the rounds. This one posits that VMware is in the midst of acquiring F5.

I don’t know whether it will happen, but it does pass the plausibility test. VMware is under competitive siege in the virtualization space, and F5’s application-delivery networking could give edge, not to mention market-leadership in an established (and related) market. Moreover, F5 and VMware already have a partnership that seems to have worked well.

All previous rumors regarding acquisitions of F5 obviously have proven false, so we’ll have to see whether this one is the exception that ends them all.

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