Brocade's Roller-Coaster Year
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&Nbsp; ) was considering buying it.
Dell did not end up buying Brocade; it bought Force10 Networks instead. This meant that
Dell would now be bypassing Brocade -- and Juniper, too -- as a supplier of networking gear. Brocade also lost out on the opportunity to resell its switches through Dell. This was not a deep cut in Brocade's revenue stream, but it would affect future growth for its Ethernet products, one of its weakest growth areas.
Black Friday for Brocade
On the morning of Friday, Aug. 5, Brocade shares fell 30% on Brocade announcing it would be missing its earnings forecast. The larger fear was that demand for IT services and equipment was weakening for all suppliers, especially from the industry's government clients.
Well, you can't say that Brocade didn't come with an interesting stopgap measure -- if not solution -- for that immediate threat. At the end of August, the company announced that it would allow some of its largest customers to get a free router and only pay a monthly fee for the number of ports it actually used. That customer would then not have to pay for more equipment than it needed, and -- very important for government agencies -- since this fee could be classified as a service, it would not affect shrinking capital expenditure budgets.
Source: Motley Fool