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Cisco's Parc Purchase: An MPLS Play

Cisco Systems Inc.'s (Nasdaq: CSCO) move today to buy out Parc Technologies Ltd., a routing optimization startup in which it already had a stake, is part of an ongoing effort to beef up its Multiprotocol Label Switching (MPLS) technology, according to experts following the deal.

Parc's MPLS software will be integrated with Ciscos IP Solutions Center -- which is software for virtual private networking and quality-of-service tasks -- says Cisco’s Cliff Meltzer, senior vice president for network management in the technology group.

Meltzer says that Parc's software helps unclog network traffic based on a series of primary and secondary routing algorithms. MPLS itself merges Layer 2 metadata, such as bandwidth, latency, and utilization, with Layer 3 packet delivery information. As it turns out, this is a complicated task that requires additional computational assistance.

“This turns out to be a very hard computational problem to solve as you get larger [networks]," Meltzer says. "Quite honestly, we weren't sure that they would deliver on it. They came through -- we did a number of field trials.”

The deal points to an industry trend to improve reliability of Internet and MPLS traffic by any means necessary, explains Abner Germanow, analyst with International Data Corp. "When you look at MPLS and the dependence that large carriers are putting on MPLS... any technology that helps enhance the reliability and management is valuable," he says.

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