Intel acquires NetEffect for $8M

Intel announced that it has bought NetEffect, a network connectivity company that focuses on technology for server clusters.

Intel acquired the company for US$8 million, giving the chip maker NetEffect's Ethernet product portfolio, intellectual property and technology, Intel said. NetEffect's products include 1 Gigabit and 10 Gigabit Ethernet (GbE) adapters for servers and blade configurations, as well as 10 GbE Application Specific Integrated Circuits (ASICs), Intel said.

"The combination of Intel and NetEffect technology will allow Intel to address our customers' most important 10 Gigabit Ethernet needs, including server virtualization, convergence of network and storage traffic, and server compute clusters," Tom Swinford, a general manager at Intel, said in a statement.

News of Intel's acquisition comes a week after it announced that its lawyers were looking into the restructuring at rival Advanced Micro Devices.

Intel has told Computerworld that its lawyers were evaluating whether a new manufacturing business spun out of AMD could end a long-standing cross-licensing agreement between the two firms.

Industry analysts said AMD's spinoff plans could put it back on track to becoming the nimble, innovative company that once had Intel on the run.

NetEffect, which has 30 employees and is based in Austin, Texas, was founded in 1998 as Banderacom. The company initially was focused on InfiniBand adapters and 16-port IB switches. The company was renamed NetEffect in 2004.