Fibre Channel switch vendors took a dive on the Nasdaq Tuesday on rumors that Hitachi Data Systems (HDS) is developing a SAN switch that will compete in the Fibre Channel space as well as in new markets for storage over IP.
HDS presently OEM's 1-Gbit/s and 2-Gbit/s FC switches from Brocade Communications Systems Inc. (Nasdaq: BRCD).
McData Corp.s (Nasdaq: MCDT) stock plummeted over 10 percent to $24.67 a share. QLogic Corp. (Nasdaq: QLGC) shares were down 4.2 percent to $49.01, and Inrange Technologies Corp. (Nasdaq: INRG) dropped 2.6 percent to $13.01. Brocade's stock fell 4 percent to $33.60 per share, although analysts said this could also be a knee-jerk reaction to the $500 million in debt financing it announced this morning (see Brocade to Raise $500M in Bond Offering). Hitachi Ltd. (NYSE: HIT; Paris: PHA) stock was up 3.22 percent at $72.39 a share. HDS is an wholly owned subsidiary.
The rumor du jour appears to stem from an investor note issued by Credit Suisse First Boston, which states that the firm is cautious on McData and Brocade as it is hearing that Hitachi has plans to enter the SAN switching market in the second half of 2002.
HDS did not return calls for comment by press time.