Virtual network architecture is hot: Oracle acquires Xsigo for undisclosed sum

Leading IT systems and technology company Oracle on Monday announced it will be acquiring privately-held company Xsigo Systems. Oracle targeted Xsigo for acquisition because of its network virtualization solutions, a hot zone in IT right now. Just one week ago, VMware announced the billion dollar acquisition of Nicira, a company that specializes in software-defined networking technology similar to Xsigo's.

"The proliferation of virtualized servers in the last few years has made the virtualization of the supporting network connections essential," said John Fowler, Oracle Executive Vice President of Systems in a prepared remark on Monday. "With Xsigo, customers can reduce the complexity and simplify management of their clouds by delivering compute, storage and network resources that can be dynamically reallocated on-demand."

Xsigo's network virtualization technology, broadly falling under the brand name of "Fabric," will be combined with Oracle VM for server virtualization, and the resulting product will be a simpler, lower cost cloud solution. Xsigo's Fabric Directors dynamically connect servers to cloud resources to reduce the number of switches in place; the Fabric Accelerator connects virtual machines to various resources (servers, networks, other VMs) through a software-defined private virtual link; and Fabric Manager is the network management interface for monitoring and maintaining all of these virtual connections.

Neither Oracle nor Xsigo announced any financial details of the transaction, but the deal is expected to close in Fall 2012, with Xsigo working independently of Oracle until then.