As Herrod describes it: Niciras software-defined networking starts by virtualizing the network, decoupling the logical view of a network from its physical implementation. It does so by creating an abstraction layer between server hosts and existing networking gear which decouples and isolates virtual networks for specific networking hardware, turning it into a pool of network capacity. This enables the on-demand, programmatic creation of tens of thousands of isolated virtual networks with the simplicity and operational ease of creating and managing virtual machines. The resulting business value comes from more agile, efficient, flexible, and robust networking configurations.

SDN has been one of the hottest topics in networking this year, and 451 Groups Hanselman says VMwares acquisition codifies some of the hype around SDN, and puts pressure on Cisco. The networking giant has outlined a path to integrate SDN features in its offerings with its , but this is going to bump up the pressure, he says.  

From an end-user perspective, thats a good thing if Cisco is being pushed to add SDN features more quickly and if VMware advances the Nicira technology, says Kyle Hilgendorf, a Gartner cloud analyst. He hears from frustrated customers frequently about the lag that the networking layer can have on cloud deployments.

Meanwhile, Niciras ability to work with multiple hypervisors and give customers choice in their cloud offerings is important, too. Some customers are starting to consider what options exist beyond VMware, says Hilgendorf. If they dont offer customers a way to expand and use other hypervisor formats, that could give them trouble in the long-term.

is also a hedge against customers feeling locked in. DynamicOp is a cloud management company that specializes in working across different providers and hypervisor platforms.