by Adam Armstrong

VMware To Acquire VeloCloud Networks

Today VMware Inc. announced that it has signed a definitive agreement to acquire VeloCloud Networks, Inc. The acquisition will strengthen VMware’s network virtualization platform, VMware NSX, while also expanding its networking portfolio to address end-to-end automation, application continuity, branch transformation and security from data center to cloud to edge. The acquisition will also put VMware on better footing as it helps its customers with their digital transformations, especially in regards to the software-defined future.

VeloCloud Networks is a provider of industry-leading cloud-delivered software-defined wide-area network (SD-WAN) technology for enterprises and service providers. The company’s SD-WAN product is able to combine the deployment speed and low maintenance of cloud-based services with the economics and flexibility of the hybrid wide-area network (WAN). The idea behind their technology is to simplify the WAN through the delivery of virtualized services from the cloud to branch offices and mobile users everywhere. VeloCloud stated that they were able to leverage intelligent x86 edge appliances to aggregate multiple broadband links at the branch office, and using cloud-based orchestration, connects the branch office to any of type of data center: enterprise, cloud, or software-as-a-service.

Organizations are looking to transition to a more cost-effective, dynamic, and scalable cloud-delivered architecture of the digital era. VeloCloud’s SD-WAN technology is ideal for this transition while also providing flexibility in network connectivity options that can augment MPLS and improves overall total cost of ownership for branch connectivity. Through the acquisition, VMware will be able to take the benefits of the technology and bring it to its large breadth of customers. The acquisition also builds off of VMware’s NSX, that delivers network and security services closest to the application. Now, VMware will be able to take the technology of VeloCloud and apply the same properties to the WAN.

VMware goes on to state that through its acquisition of VeloCloud, it will be able to help service providers increase revenue and service innovation by delivering elastic transport, performance for cloud applications and a software-defined intelligent edge that can orchestrate multiple services to meet customer needs. VMware believers that leveraging the SD-WAN it will be able to simplify the deployment of virtual network functions (VNF) for applications such as security by combining the proven VMware vCloud NFV platform with a cloud-delivered SD-WAN platform.

The transaction is expected to close in VMware's fiscal Q4 2018. There is no change to VMware's previously provided fiscal 2018 guidance due to this transaction.

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