Founded in 2002, start-up NeoPath has clocked up around 30 customers for its Linux and Intel-powered NAS virtualization software, which creates a single namespace across multiple NAS filers.

The deal will see Cisco lead NeoPath’s next investment round, taking a $3m-odd stake in NeoPath. Despite a report to the contrary, one source insisted that Cisco will not gain first refusal rights to purchase NeoPath. The negotiations have not progressed far enough to have covered any OEM or reselling arrangements between Cisco and NeoPath.

Cisco already has a significant share of the SAN switch and director market via the technology originally developed by its spun-in start-up Andiamo, and a presence in the nascent WAFS market via its acquisition of Actona in 2004. Tied into its Actona-powered WAFS business, Cisco also resells NAS devices from EMC Corp and Network Appliance Inc.

Why Cisco has not bought NeoPath outright is not known. Potentially, it may not have been able to persuade NeoPath to sell out this early, or it may not yet be convinced that it wants anything more than a stake and an ability to influence NeoPath’s direction.

NeoPath’s NAS virtualization system is similar to those developed by fellow start-up Acopia Networks Inc, or acquired by EMC Corp with the purchase of Rainfinity Inc and by Brocade Communications Systems Inc with its acquisition of NuView Inc, which is due to close soon. All of these systems provide a virtualizing layer that can be applied to existing heterogeneous NAS devices, tying them into a single namespace to ease management, and to improve performance to some degree.

This is an alternative approach to the clustered or distributed file systems that are embedded in the NAS storage from suppliers such as PolyServe, Ibrix or Isilon, and will soon appear in NetApp filers, courtesy of Spinnaker. These may provide greater performance, but cannot be used to simplify the management of legacy or already installed filers.

NeoPath’s software currently runs on a Dell server, and so could easily be hosted on an x86-powered blade within a Cisco Ethernet switch, or on Cisco’s MDS 9000 SAN devices. As a principally Fibre Channel device rather than an IP file-level-friendly Ethernet switch, the latter may not be such a suitable host.

NeoPath says it has attacked the market horizontally, and has had most success amongst service providers and non-laboratory governmental organizations. A fail-over pair of Dell servers running its software costs around $70,000. NeoPath says that because the device only becomes in-band when needed, it qualifies as a router. The software creates a single namespace, and most importantly allows file to be migrated between heterogeneous NAS filers while they are online or being accessed by users. A rules-based engine can migrate files automatically.