For the second time in recent weeks, Israeli networking tech company Mellanox has made a major acquisition in the silicon-photonics realm.
After shelling out $82m in cash for Silicon Valley-based Kotura in May, Mellanox announced this week that it was buying Danish optical interconnect component designer IPtronics for $47.5m in cash. It's a sign that company is stepping up its efforts in a sphere of technology that other networking tech companies, from Intel to Cisco and others, are racing to embrace themselves.
The deal is set to close later this year, and has already been approved by the boards of both companies. IPtronics is based in Denmark, and Mellanox will keep the company's product line and facilities intact and in place, rechristening IPtronics' facilities as Mellanox's first European R&D facility. The arrangement is similar to the one with Kotura, which is also to be converted as is into a Mellanox unit.
IPtronics is a fabless semiconductor company offering next generation integrated circuits for parallel optical interconnects. The relatively new optical networking technology uses optical rays to transfer signals, and is able to work at much greater speeds than electrical conductors, and requiring less power.
IPtronics' offerings include chipsets and drivers for Multichannel Vertical Cavity Surface-Emitting Lasers (VCSEL), technology that the company says could be used to design optical interconnects with a bandwidth of 100Gbps to 350Gbps.
Several Mellanox products use IPTronics' chip, the company said, making the decision to acquire the company an easy one for Mellanox, which saw optical networking technology as an important component of future networking, especially in the era of big data.
That, too, is something it has in common with IPtronics; the company believes that "the amount of data in all types of electronic appliances and networks is rapidly increasing," and "as a consequence, the transition from electrical to optical interconnects is inevitable".
With over $120m invested in optical connect technology now, it appears that Mellanox, an advocate of high-speed Infiniband technology, clearly sees it that way too, as it strives to turn 100Gbps networking speeds into an everyday thing for enterprise.
That, in fact, is exactly how Mellanox CEO Eyal Waldman put it, saying: "The proposed acquisition of IPtronics is highly complementary with our recently proposed acquisition of Kotura. IPtronics' parallel optical interconnect ICs further solidify our strategy to have a full end-to-end solution for the server and storage interconnect."
Mellanox is far from the only networking tech company to be bitten by the silicon-photonics bug. In April, Intel unveiled its own silicon-photonics chip operating at 110Gbps and is, according to the company, a completely integrated module that includes silicon modulators, detectors, waveguides and circuitry. To go with the chip, Intel is also developing (with Corning) photonics-friendly cables and connectors. Cisco, too, is working on the tech, in the form of its recently unveiled a 100Gbps pluggable transceiver based on its proprietary CPAK form factor.