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Wed 1 Nov 2006 12:00 AM

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Brocade Wades into MEA battle

Following its recent US$700m acquisition of rival storage network vendor McData, Brocade has put into place a series of initiatives for global growth, which includes increasing its exposure to the Middle East market

US-based storage networking outfit Brocade has become the latest technology outfit to declare its Middle East ambitions by revealing that it will open an office in Dubai in an effort to raise awareness of its products among regional customers.

The move represents a remarkable turnaround for the company, which made global sales of almost US$600m last year.

Previously, Brocade’s Middle East business had been run from Europe meaning a lack of on-the-ground presence to keep abreast of local developments in the Middle East.

“We couldn't keep operating remotely in the Middle East if our competitors are here, operating locally, communicating with our customers,” said Khalid Khalil, the new regional MEA manager at Brocade.

“It is important that we show the market we are here.”

Khalil is adamant that opening of a new office, which will be located in Dubai Internet City’s Al Shatha Tower, will not only raise customer awareness of Brocade in the Middle East, but also function as a base to provide better support and training to partners in the region.

However, it will clearly take time for the company to scale up and give the market the proper attention it deserves.

The operation will initially accommodate just two employees — a systems engineer and sales head — but Khalil intends to add a further three members of staff within the next six months.

“This prudent approach to entering a market worked tremendously well in countries like Russia, and we want to gradually establish a firm base in the region,” said Khalil.

“I'm not a fan of the American approach of entering a market in an aggressive manner.

We’re currently growing at a good rate and we just need a local base in order to maintain this growth.”

While the publicly-quoted company’s initial set-up might look small, it harbours more ambitious long-term plans for the region.

“We are looking at Saudi Arabia as potentially the next step of our regional expansion and we hope to have 14 or 15 employees in the UAE, Saudi and Turkey within the next two and a half years,” explained Khalil.

Analysts insist that a solid local presence is fundamental if Brocade is to stand any chance of matching more heavyweight technology competitors.

Hamish MacArthur, analyst at UK-based storage consultancy MacArthur Stroud, told Channel Middle East: “Brocade is responding in such a way because a company operating globally has to have a greater presence in local geographic areas.

To a large extent, recommendations from companies like EMC, IBM or HP will be predicated by support that they can get locally.

If they can’t get support locally from Brocade, they’ll probably lean towards Cisco,” he added.

A key factor in determining Brocade’s success in the Middle East region will be its ability to engage with local partners, particularly as it is heavily reliant on OEM agreements.

Its current portfolio of SAN products remains the domain of OEMs, but the vendor admits it is looking to develop a distribution channel for its range of “Tapestry” network products.

Khalil, who has been with the vendor for more than a year and a half, plans to use the majority of his marketing budget setting up an education campaign for resellers across the Middle East.

MacArthur says the addition of local resellers, alongside the support of OEM partners, would certainly lend it the geographic reach and coverage needed to compete in a fast-changing storage network sector.

He said: “There is still strong demand for hybrid channels, and that will continue for very high resilient solutions, but the development of iSCSI, the connectivity across IT networks, means that the threat from Cisco and other network players becomes more of an issue.

Changing networking products and technologies has also created an issue in terms of the way that some of the switching is moving into the chip environment.

That brings companies like QLogic into play as a much more real threat,”concluded MacArthur.

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