Broadcom Barrels Into 4-Gig

Broadcom Corp. (Nasdaq: BRCM) is trying to muscle its way into a crowded 4-Gbit/s Fibre Channel switch field.

The company announced chips for 4-gig front-end and back-end embedded Fibre Channel switches, and it says it's ready to ship.

Availability doesn't guarantee, however, that Broadcom will gain any design wins. The real race begins when everybody else is there,” says Greg Schultz of Evaluator Group.

Everybody else means the drive, systems, HBA, switch, component, and testing vendors. and Hitachi Global Storage Technologies (Hitachi GST) and Seagate Technology Inc. (NYSE: STX)will probably ship the first 4-gig disk drives later this year (see 4-Gig for Show).

Broadcom is competing in two segments. Its back-end embedded switches will bump heads with Emulex Corp. (NYSE: ELX), QLogic Corp. (Nasdaq: QLGC), Agilent Technologies Inc. (NYSE: A), and PMC-Sierra Inc. (Nasdaq: PMCS) -- all of which will also be aiming to work OEM deals with storage system, disk, and blade vendors.On the front end, Broadcom will look to sell its chips to switch vendors Brocade Communications Systems Inc. (Nasdaq: BRCD), McData Corp. (Nasdaq: MCDTA), and Cisco Systems Inc. (Nasdaq: CSCO). All three, though, are already developing 4-gig switch components of their own and are unlikely to restart interoperability testing with a new player.

On the back-end or embedded side, Emulex is already the clear leader, since it has shipped to OEMs more than two million ports of its InSpeed embedded switches, according to market research firm Dell'Oro Group.

Emulex already claims at least 13 OEMs for InSpeed, including Hewlett-Packard Co. (NYSE: HPQ), Network Appliance Inc. (Nasdaq: NTAP), Fujitsu, Quantum Corp. (NYSE: DSS), and BlueArc Corp..

So it looks as if Broadcom's biggest challenge will be to get companies to change their minds about what they've already decided to do. Since 4-gig technology is backward compatible with the current 2-gig switches, it would behoove Broadcom to offer an incentive to shift not only from lower speeds but from one vendor to another.

About pricing, Broadcom's senior director of Fibre Channel Switching products, Michael McDonald, says, “We realize we have to be very aggressive there.""In the SMB space, 4 gigs is probably the least of the customer concerns,” Schulz says. “It’s a question if you can do 4 gigs for less than 1 gig costs now. They’d have to do it about the price of an Ethernet... switch," which is about $200.

Broadcom appears determined to make it with the 4-gig switch technology, which it acquired relatively cheaply when it paid $5.8 million for bankrupt storage pioneer Gadzoox in March 2003 (see Broadcom Switches on FC and Broadcom Gulps Gadzoox). That acquisition allowed Broadcom to go from offering Fibre Channel SerDes (serializers/deserializers) to offering FC-based silicon products.

Broadcom has moved further into storage by acquiring SATA controller startup RaidCore; and earlier this month it announced a NIC that combines a TCP/IP offload engine (TOE), an iSCSI host bus adapter (HBA), and remote direct memory access (RDMA) technology on one chip (see Broadcom Broadens Storage Play and Broadcom Raids SATA Startup).

Now the company sees 4-gig switches as another storage frontier. “We view storage as a fundamental place where the company can continue to grow,” McDonald says. “And we’re very bullish on 4-gig technology.”

But there are a lot of bulls in that field already.— Dave Raffo, Senior Editor, Byte and Switch