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SAN Valley Does the Cisco Two-Step

LAS VEGAS -- Networld+Interop -- SAN Valley Systems Inc., one of a slew of startups now entering the IP storage networking market, is walking a fine line between working with Cisco Systems Inc. (Nasdaq: CSCO) and competing against it.

Cisco has invested in SAN Valley, while, at the same time, launching its own IP-based SAN (storage area network) products; and SAN Valley is working with companies that compete with Cisco in other markets.

At the Networld+Interop trade show held here this week, SAN Valley demonstrated its storage product working with a Compaq Computer Corp. (NYSE: CPQ) DRM (disaster recovery management) package, as well as equipment from Brocade Communications Systems Inc. (Nasdaq: BRCD), ADIC Storage Solutions, and LuxN Inc..

SAN Valley is in talks with other hardware vendors about possible OEM agreements. "It's all about execution for us now," says Rick Walsworth, vice president of marketing. He was unable to comment further on possible deals.

It should be noted, however, that SAN Valley could also be an acquisition target for Cisco, which is eager to become a major force in the storage market. Walsworth admits there is "no telling what's around the corner." He points out that Cisco lacks a service provider offering, "a significant hole in its storage strategy." Coincidentally, that's where SAN Valley's technology fits.

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