A Rose By Any Other Name Still Can’t Grow Market Share

With apologies to the Bard of Avon…The news is finally going mainstream regarding Vernier Networks getting out of the NAC market and changing its name to Autonomic Networks. Industry observers are digging deep to read the tea leaves as to what this means to the industry as a whole, with specific speculation about Vernier’s one-time inline NAC rivals, Nevis and ConSentry. Matt Hines at InfoWorld quotes Paul Roberts at the 451 Group as saying, “ConSentry and Nevis Networks -- both direct rivals of Vernier -- could be among the other NAC providers looking to be sold, or under consideration for a buyout from the bigger fish”.

Before we offer some insights on the Vernier situation, it’s important to point out that this move by Vernier really has no bearing on us or what the industry perceives to be similar companies. The fact is that Vernier is a very different situation, with a substantially different product. For example, what Vernier was never able to figure out, or couldn't make work, was the importance of delivering inline access control as a secure switch, as well as an appliance. This critical detail is lost on many of the pundits covering the NAC market in general (because the concept of a secure switch is lost on the out of band appliance vendors), although ConSentry to its credit, as well as Nevis, is educating the market. Vernier was also at a different growth stage, and with a different set of investors, having raised over $100 million dollars with less to show for it than many of the other NAC vendors, not to mention its more direct inline competition. The telling point is that it appears that Vernier needed to ramp down its headcount into the 50 or so range, according to the Matt Hines article, and, well, that just requires a new plan and a new image to survive.

Nevis, which has had a different growth model, and quite frankly a different primary focus, is not in the same situation. We continue to ramp sales, and gather momentum and support from both the market and our investors. Now is not the time to be looking for the exits (it’s only Act II after all), although I don’t think any company would be completely closed-minded to a reasonable consolidation offer, NAC vendor or not. Having said that, it’s hard to deny that some consolidation in the NAC space isn’t warranted. The NAC market is still immature, and hasn’t grown according to early prognostications. But, here again, that may not have a great bearing on Nevis. We don’t consider ourselves a “NAC vendor”, in the way that the industry likes to clump vendors into simple sound-byte buckets. We have always taken a much broader view of the real problem customers are facing, and offer a solution of which NAC is only one of several primary components. We believe companies are better defined by the markets and problems they address than the features of their product anyway.

Back to Autonomic Networks (nee Vernier), it’s interesting that the industry view is that they are getting out of the NAC market and have remade themselves into a “role-based access control” solution based on existing intellectual property, while their “inline NAC technology may… be up for sale”. It has always been our contention that role-based access control, along with NAC (as well as intrusion detection and application use controls) are an integral part of a complete solution customers are looking for. It’s no secret that the inline vendors have always had a major advantage in this area, and that ultimately that’s what the market will demand. As Forrester stated early last year “NAC as we know it will fail”, and pure NAC vendors are seeing some effect of that. We are trying to change the “as we know it” part. We know the market needs more, and we believe customers (and finally the analysts and press) get it as well. It just doesn’t make sense to us that Vernier would throw the baby out with the bathwater, although we wish them luck in whatever they end up sorting out. It seems like I've seen this play before though...