Nov 13 (Reuters) - Virtual networking startup Big Switch Networks is launching its Open Software-Defined Networking (SDN) product suite on Tuesday, its first commercial product since it was founded in 2010.
The product allows customers to change via software the networks and data centers that they access, avoiding upgrades to expensive and proprietary hardware, and could threaten the core business of networking equipment makers such as Cisco Systems Inc.
Although the nascent SDN market is still small, its growth potential has spurred heavy interest in acquiring startups, especially since VMware bought Nicira in July for around $1 billion.
"This is a very big change in how we build networks," said Big Switch co-founder Guido Appenzeller, who started the company with former Cisco product manager Kyle Forster in March 2010.
The startup is backed by ex-Cisco executive Mike Volpi through Index Ventures as well as Goldman Sachs, Khosla Ventures and Redpoint Ventures.
The company said its partners include Arista Networks, Broadcom Corp, Citrix Systems Inc, Dell Inc , Juniper Networks Inc and Microsoft Corp .
Interest in the SDN sector has been heating up.
"There are currently 20 to 25 venture-funded SDN companies and a lot of noise in the market," said Brian Marshall, an analyst at ISI group.
Startup Midokura launched its MidoNet software platform in the United States last month and Embrane, founded in December 2011 by Dante Malagrino, another ex-Cisco manager, has launched Heleos.
Startup Vyatta was bought by Brocade Communications Systems Inc earlier this month.
"We do believe that SDN is here to stay and will eventually cause substantial shifts in the networking market, beginning in the data center," said JPMorgan analyst Rod Hall.
"We don't see SDN as a real earnings risk until late 2014. However, we believe the technology is here to stay and expect the hype cycle to increase in 2013 as numerous trials deploy," Hall added.