Service gateways are multi-function devices for branch offices, sometimes referred to as branch-in-a-box, BiaB, and usually comprise a router and multiple security features. Cisco was first in the space with its Integrated Services Router, and then last year Juniper joined the fray with its Secure Services Gateway, which runs on the ScreenOS operating system it got with the NetScreen acquisition but with the routing protocols ported across from JunOS.

In mid-2005 Sunnyvale, California-based NetD launched the original, eight-slot version what it calls the Unified Service Gateway, which includes a router, a switch, a firewall, an IDS/IPS system, anti-virus, and triple-A identification services. It followed up with a four-slot entry-level box in March 2006. The SG8 had a price tag of $14,990, while the SG4 listed at just over half that price.

Routing, firewall, and VPN are included in the basic price, with customers at liberty to turn off the routing if they want to continue running some other router such as a Cisco box. Other functionality such as IDS/IPS and anti-virus require separate license agreements because they are supported by signature update services.

The SG8 is a competitor to Cisco’s 7000 Series in terms of routing, but the Cisco box has no security features. Cisco’s Integrated Services Router does have space in the box for multiple line cards running apps such as security, VoIP, optimization/acceleration, and wide-area file systems, but it has fewer routing capabilities than the SG8. The SG4 competes with Cisco’s ISR 3200 Series, but can outperform it even with all the available services switched on.

However, NetD started to run into problems shortly thereafter. Sources close to the company said there were issues around its ownership, and in mid-year it closed down all its sales operations. One source said: Alcatel-Lucent have acquired the IPR, and not many companies have a high-performance branch router in their portfolio.

The difference between the NetD technology and its competitors is that, having built its product from scratch without needing to base it on an existing OS such as Cisco’s IOS, NetD developed a modular system, which it claims suffers no service degradation as the additional functions such as security and VoIP are turned on. Juniper also claims far less performance impact on the SSG as more functions are turned on compared to the ISR.

No details were disclosed regarding the price paid by Paris-based Alcatel-Lucent.

Our View

The BiaB market gains another contender with this acquisition, which follows Nortel’s acquisition of Tasman Networks for the same reason in December. Alcatel-Lucent is not a heavy hitter in enterprise networking, and indeed, neither are Nortel or Juniper, but the NetD technology at least gives it something to offer into its existing customer base.

Also, the NetD boxes should enable the new owner to target the service provider market, where they can be positioned as CPE kit for managed services. Cisco says a significant portion of its ISR shipments are into carriers for managed WAN and value-added security services.