4-Gig Boomerangs on Brocade

11:15 AM -- When Brocade was gobbling up Fibre Channel switch market share late last year and early this year, people in the industry wondered how much that was due to its being first out with 4-Gbit/s gear.

Apparently, first-mover advantage had a lot to do with it. According to the latest market research from Dell'Oro Group, Cisco and even McData picked up director share last quarter after rolling out 4-Gbit/s devices.

Cisco especially jumped in its first full quarter of shipping the 4-Gbit/s MDS9513. (See Cisco Goes 4-Gig & Big.) Cisco widened its overall director lead, jumping in revenue from $68.5 million to $81.4 million in the third quarter and increasing revenue market share from 33.6 percent to 37 percent.

McData's director revenue also ticked up from $67.1 million to $69.3 million despite its lame-duck status, as Brocade prepares to close the $713 million acquisition it announced in June. (See Brocade Bags McData For $713M.)

Meanwhile, Brocade barely increased its director revenue from $68 million to $68.7 million, and its market share slipped from 33.3 percent to 31.2 percent.How big a role did 4-Gbit/s specifically play last quarter? Cisco more than doubled its 4-Gbit/s revenue from the second quarter, going from $24.4 million to $57.4 million, and McData went from $16.9 million to $33.6 million. Brocade's 4-Gbit/s director revenue crept from $62.6 million to $62.7 million, and its market share dropped from 60.1 percent to 40.7 percent in the face of more competition.

Overall, Cisco moved past McData in Fibre Channel switch revenue, climbing for the first time into second position behind Brocade.

The numbers differ from those the vendors reported in their latest earnings reports, mainly because Dell'Oro tracks numbers by calendar quarters. The Dell'Oro report includes figures for July through the latest quarter, while Brocade, Cisco, and McData's last fiscal quarters ran from August through October.

"Cisco had a strong month of July, it's their year-ending quarter," Dell'Oro president Tam Dell'Oro says. "Also, their new four-gig cards made up 70 percent of their volume last quarter."

Will this translate to further gains for Cisco now that Brocade no longer is the only 4-Gbit/s game in town, especially with Cisco's recent release of a 4-Gbit/s fabric switch? (See Cisco Salvo in 4-Gig FC.)Brocade hopes not. Brocade's marketing VP Tom Buiocchi played down the role 4-Gbit/s plays in buying decisions when that topic was broached during the company's earnings call last month.

"It's not clear that four-gig or a technology cycle accelerates purchases," he said. "Customers typically buy when they need capacity. And so they happen to buy four-gig when it's available. But I'm not sure four-gig stimulated demand."

Maybe not, but it's some coincidence that all three major switch vendors' sales spiked right after they made 4-Gbit/s gear available.

Dave Raffo, News Editor, Byte and Switch