Cisco buys Whiptail for $415 million amid solid-state storage run
Summary: Cisco's acquisition highlights the run on solid-state storage companies as data center players aim to speed up applications. — Cisco on Tuesday said it will acquire Whiptail, a solid state memory system company, for $415 million.
Context & Ripple Effects
Cisco's $415 million agreement to buy Whiptail lands three weeks after the company said it would cut 4,000 jobs despite an 18% jump in fourth-quarter profit, and months after it exited consumer networking by handing its Home Networking unit to Belkin. Taken together, the moves sketch a company pruning the edges of its business and reinvesting where margins and growth sit: the data center.
The Whiptail deal also confirms what the day's coverage across outlets from the Wall Street Journal to SiliconANGLE framed as a broader scramble — data center players racing to acquire solid-state storage companies so applications run faster. Cisco had already been stitching together cloud-oriented pieces, including virtual network overlay specialist vCider in 2012; Whiptail adds the storage layer it lacked.
First-order effects
- Cisco gains an in-house all-flash storage system to attach to its own servers and networking gear, turning Whiptail's product line into part of a single-vendor data center stack.
- Whiptail's independent run ends immediately: its engineering and roadmap are now absorbed into Cisco's data center portfolio.
Second-order effects
- Rival server and networking vendors now face the same gap and must respond with their own flash acquisitions or partnerships, tightening supply and raising prices for the remaining independent solid-state storage startups.
- Established storage vendors lose the option of staying disk-centric at the high end, as customers benchmark arrays against flash systems sold alongside compute and network contracts.
Third-order effects
- If the acquisition run continues, storage stops being a standalone category and becomes a component of converged data center platforms owned by networking-scale vendors, squeezing mid-tier array makers on both price and distribution.
- The pattern also raises the absorption risk that shadows every specialist sale: once flash expertise lives inside a giant acquirer's roadmap, its pace answers to the parent's priorities rather than the storage market's.
The trend: Data center infrastructure is consolidating around flash, with networking giants buying storage specialists outright rather than partnering as solid-state performance becomes the application-speed battleground.