Earlier this spring, I met with Sir Terry Matthews at a Mitel Analyst event here in Toronto and we briefly spoke about one of his investments (Solace Systems), which is focused on application aware networking (i.e. XML routing).  Having heard about Solace's deployment at Allstream, I was already familiar with the company, but his enthuasism was so contagious that I had to go and check the company out myself at Supercomm.

And I came out impressed with seeing some real live demos of application-aware networking, and the notion of being able to classify, filter and parse massive amounts of incoming data as it flows through an enterprise's network.  XML will be an enabler for powerful machine-to-machine interactions in the future.  There are several protocols that already rely on XML to handle and manipulate data streams, including, among others, SAML, SOAP, UDDI, XML-RPC, etc.  There is an obvious need to have some gear that can manipulate, parse and transform XML at network speeds.  We are talking about a potentially destructive technology that can profoundly alter the landscape of the Layer 4-7 routing market. 

The key is achieving this goal and stay within the key CIO goals of not increasing performance bottlenecks or security vulnerabilities.  Market timing is important, and as usual, Mr. Matthews has correctly anticipated the need for XML processing infrastructure.  Hence, it was not surprising to see companies such as Solace and MA-based DataPower get the R&D jump on a few other competitors.  One of the questions on every analyst's mind, though, always was that if this technology was so great and potentially disruptive, how come none of the technology giants made too much noise about it thus far?  Other than Solace and DataPower, only a handful of other vendors had been active in the application aware networking market - including Ciena and NetScaler. 

That is no longer the case.  After a few rumors on the press (most noticeably on this insightful article), Cisco has finally come out with more details on its AON (Application-Oriented Networking) initiative during its Networkers 2005 customer and partner conference in Las Vegas.  This will be Cisco's seventh AT (Advanced Technology) growth market (there are 12 ATs in total, with 6 of them already announced and 6 yet to be announced). Enterprises having Cisco's Catalyst 6500 Series switches or 2600, 2800, 3700, and 3800 Series routers will not have to replace their existing infrastructure - all that will be necessary is for them to plug in AON blades when they will be generally available.  During the event, there was also talk about a likely AON wireless and RFID module for the ISR router, the availability of some management software, and the announcement of some technical relationships with several companies including IBM, SAP and Tibco.