Riverbed just announced the acquisition of virtual appliance and cloud load balancing company Zeus Technologies. Zeus is an almost 15 year old startup that competes directly with F5 and Citrix Netscaler. I have a unique perspective on this, as I was Director of Product Management at NetScaler, responsible for the advanced acceleration features of the load balancer, and then for the acquisition of Orbital Data, which became WANscaler, Citrix’s competitor to Riverbed. As if that wasn’t enough, then I went to work for Zeus to replace their departing CTO. I ended up running marketing for Zeus, where we nearly sold the company, and I implemented the company’s usage-based pricing and kicked off their first two cloud reseller deals.
Zeus is a unique technology. Developed by Cambridge computer science grads almost exclusively, it was able to use software to outperform most hardware load balancers, and it had more layer 7 abilities than other load balancers. However, it was a “best kept secret” in load balancing and didn’t market itself as aggressively as other players, instead focusing on making newer and better technology. The cloud has been kind to companies that use software to replace hardware because software can scale up and scale down as needed, but hardware doesn’t. That’s why hardware players Riverbed and F5 both took a long time to launch virtual appliances, and both companies’ virtual offerings are not as fast as their hardware.
That may change with the new Riverbed acquisition. They now have a high-end, N+1 scaling load balancer that can look at full layer 7 packet info and make intelligent decisions based on it. Even better, it resides natively in the cloud, and can be used to route certain flows to Riverbeds software – or even hardware – on a policy basis. That’s a pretty sweet capability, and one that could set Riverbed apart.
Should Citrix be worried? I’m not so sure. Citrix has made major tracks with OpenStack recently and has a very strong cloud-resident load balancer and WAN optimization that works well with their virtualization protocol, ICA. From that perspective, this deal may be Riverbed catching up to Citrix and F5. It looks like Joe Skorupa at Gartner was right years ago when he predicted that WAN optimization and load balancing belonged together! The top 3 players in load balancing and WAN optimization all provide both now, although F5’s Swan Labs-derived WAN optimization is not popular.
But here’s the kicker: WAN optimization doesn’t work on encrypted traffic (some forms can be unencrypted, but not all) because you can’t compress random bits very well, and encryption makes for random bits by design. If Riverbed, Citrix, and F5 are going to be able to win cloud deals, they’re going to have to play nice with encryption vendors, as their customers scramble to encrypt their traffic using strong encryption with cloud-secure policy-based key management.
The rumors on the street a few months ago were that Cisco had made a run at Zeus too but didn’t close the deal. That may have been a mistake, from a cloud perspective.