The news that Microsoft has given its blessing to a WAN acceleration appliance is quite a coup for the supplier concerned, Packeteer. As we reported earlier this week, the two companies will jointly promote Packeteer's new iShaper boxes which are specifically targeted at Windows users and applications.

Packeteer's CEO Dave Côté says the reason his company persuaded Microsoft to sign up as a supporter is simple: Packeteer is pretty much the only WAN optimisation company - or at least, the only one of substance - to build its systems on Windows, while its rivals use various versions of Unix or Linux.

"We deliver on the Windows platform - that was important to Microsoft," he said. "It also allows us to deliver Windows services, so our CIFS acceleration is true CIFS, for example. And as Microsoft works to improve CIFS - it will be different in Longhorn - we can build on top of that."

The iShaper is also Packeteer's first all-in-one WAN appliance - it merges its long-standing PacketShaper bandwidth management and WAN monitoring devices with the iShared WAFS systems that it acquired with Tacit and the SkyX protocol optimisers that it bought with Mentat. It means that Packeteer can at last challenge rivals such as Expand, Juniper and especially Riverbed on a reasonably equal footing.

"It has an in-line plane, where we do deep packet inspection, quality of service, acceleration and so on," says Côté. "Then CIFS is done in the advanced services plane, where the Microsoft capabilities live.

"The in-line plane is our proprietary O/S - a kind of virtual environment, hosted on Windows Storage Server 2003. You can get to 80 percent of Packeteer features from within Windows, and the rest through an 'Advanced' tab which brings up the PacketShaper UI. It's like going to the command line interface of Windows Server."

Hardware upgrades

It won't be possible to install iShaper software on existing PacketShapers - you can add the SkyX element, but the iShared part needs new hardware because of its requirement for local disk. "We do have an aggressive upgrade scheme though," Côté says, noting that PacketShaper owners could also add WAFS capability by buying an iShared appliance, either as hardware, or as software to install on a server of their own.

Côté admits that the deal with Microsoft is not exclusive, and will not see the Redmond giant delivering hardware. Instead, the main thrusts are joint marketing, especially to organisations looking at server consolidation, and a Microsoft reseller programme offering discounts on iShaper.

"Server consolidation is the longer term driver - it's WAN optimisation that makes it possible," he says, noting that for some organisations the big saving comes from pulling all their sensitive data back to HQ, instead of having it spread around on branch office servers.

"One financial services customer of ours said it saves $12,000 a year on audit costs per branch by taking out all the local instances of data," he adds.

Turning to the other things that he sees promoting the uptake of WAN optimisation, he says the next biggest is having voice and video on the same network as data.

"Voice is easier to manage as a traffic type, it's smaller and relatively homogeneous," he says. "But video has several types - videoconferencing is mission-critical, say, but a web presentation is not, and then you have non-essential video such as YouTube.

"So video traffic needs to be highly differentiated, and the ability to deal with different types of video and voice is going to be more important."

He continues, "We are seeing bigger pipelines than ever before, and I think we will see a lot of people renew their networks over the next two to three years - networks that were put in in '98, '99, 2000. Things are coming together now - new application types are forcing new types of network. And you have MPLS, which is more advanced in Europe than the US, and is one of the enablers for triple-play voice/video/data networks."

Packeteer's bounce-back

So will iShaper and the Microsoft deal be enough to put Packeteer back on top? Not surprisingly, Côté is sure that it will - indeed, he claims that contrary to the comments of some analysts and observers, it has remained ahead of rivals such as Cisco, Citrix, Expand, F5 Networks and Juniper.

"I think Riverbed is the only one that's jumped ahead," he says. "Cisco has become more aggressive here, but it's still fear, uncertainty and doubt - their products are not that impressive. "We were not always the first to market, but we have integrated technologies as we needed them. For example, with compression we were two years after Expand and a year and a half after Peribit [now owned by Juniper] but within a year we were the market leader."

Wasn't that inevitable, given that Packeteer has been in the business longer than any of the others, and therefore has existing customers to sell each new capability to? Côté says it is more than that - in particular, it is Packeteer's well regarded WAN monitoring capabilities, which show which apps are consuming bandwidth and therefore need 'shaping'.

"I think that will be just as compelling in the acceleration space - it's about analysing the traffic so you can see what needs what," he says, explaining that some will need compression, some needs WAFS, some needs protocol optimisation, and some need a combination of those. He adds that Packeteer even does "a decent amount of [network] probe replacement - it is a definite tactical opportunity for us."

In any case, Côté says that the real need and opportunity for all the companies in this field is to reach those potential users who could benefit from WAN acceleration but don't yet know it - a number that he estimates could be as many as three to four million.

"This market is relatively under-served," he says. "So it's possible I could call on a customer that no-one else is calling - they don't have to go out to bid. Large customers all do evaluations, but there's a fair number of small and mid-size ones where if you solve their problem, you're in."

He concludes, "Things are coming together now, with new application types are forcing new types of network. We have the platform to build on, and the ability to add Microsoft technologies or platforms gives room to grow."