Deal Expands AT&T’s SD-WAN and White Box Capabilitie s

AT&T* has agreed to buy the Vyatta® network operating system and associated assets of Brocade Communications Systems. This platform includes the vRouter product line. AT&T also intends to hire certain Brocade employees associated with that business. The deal is expected to close in early summer, subject to closing conditions and prior to the closing of the previously announced proposed acquisition of Brocade by Broadcom Limited. Financial terms were not disclosed.

The Vyatta platform will help AT&T continue to drive its network transformation. We expect to virtualize and software-control 75% of our network by 2020. Our plan is to hit 55% by the end of 2017.

“Our network transformation effort lets us add new features quicker than ever before at a much lower cost,” said Andre Fuetsch, chief technology officer and president of AT&T Labs. “Being able to design and build the tools we need to enable that transformation is a win for us and for our customers.”

After the deal closes, AT&T will own the Vyatta network operating system, including its virtual network functions (VNFs) and distributed services platform, software under development as part of its unreleased roadmap, existing software licenses, and related patents and patent applications. The Brocade employees expected to join AT&T are mostly located in California and the United Kingdom.

This acquisition will bolster our ability to deliver cloud or premises-based VNFs, starting with our previously announced SD-WAN cloud service with VeloCloud.

The Vyatta acquisition will also expand AT&T’s white box platform capabilities. In late March, we completed a trial with a handful of companies and industry groups to design and build our own white box switches to manage data traffic more efficiently across our network.

*AT&T products and services are provided or offered by subsidiaries and affiliates of AT&T Inc. under the AT&T brand and not by AT&T Inc.