But the acquisition is not without risks. It poses a massive integration challenge for Ciena (CIEN), the likes of which the company has never dealt with before. As Jefferies & Co. analysts wrote in a research note this morning, “We can’t think of anyone in Ciena’s management team that has ever been involved in–much less integrated–an M&A deal like this.”

Continuing, Folino accuses Broadcom of engineering its bid to commandeer new contracts that Emulex recently won at the expense of its rivals–including Broadcom.

“Your unsolicited proposal is opportunistic given Broadcom is uniquely aware of the new unannounced design wins that Emulex has secured with tier-one OEMs at the expense of Broadcom and other competitors,” Folino writes. “As you know, these design wins are kept confidential at our customers’ request and do not typically begin contributing revenue for several quarters. Thus, Emulex’s stock price does not fully reflect the long-term value creation potential that the Company has already secured. However, given that some of these design wins have come at your expense, including your core Ethernet networking business, you are uniquely aware of the future value we have secured and how well positioned we are to unseat you on many other platforms in the near future. We believe your proposal is an opportunistic attempt to capture that value, which rightly belongs to our stockholders.”

In other words, quit low-balling us–especially if, as you profess, you’d like to move ahead with a deal in a “friendly, collaborative manner.”

They are basically bandwidth hogs.”

–Alan Mauldin, research director with Washington-based research firm TeleGeography, comments on Google’s capacity requirements.

If your corporate mission is to organize the world’s ever-increasing mass of digital information and make it universally accessible and useful, sooner or later the telecom costs and peering fees associated with the transmission of that information are going to get, you know, quite large. So large, in fact, that it may make sense to build out your own network.

Which is why for the past few years, we’ve been hearing rumblings about Google (GOOG) leasing hundreds of thousands of square feet of carrier hotel space, buying up dark fiber and mulling the purchase of hundreds of millions of dollars in DWDM and Ethernet-based telecom equipment.

It’s clear that Google has a big appetite for network capacity, but apparently it’s quite a bit larger than previously thought–undersea-cable large. This morning Google revealed that it had joined a six-company consortium to build out a trans-Pacific multi-terabit undersea cable. The project is called Unity and is scheduled for service launch in 2010.

“As more and more people conduct online searches and interact with applications like Gmail, Google Earth and YouTube, we’ve had to think outside the box to create a more scalable, affordable and easy-to-manage network that meets our users’ needs worldwide,” Google’s Manager of Network Acquisitions Francois Sterin wrote in a post to the company blog. “One of the biggest challenges we face is staying ahead of our broadband capacity needs, especially across Asia. One of the ways we are addressing this is by working with five other international companies to create a consortium. Collectively we just signed an agreement to build a new high-bandwidth subsea cable system linking the U.S. and Japan (more detail in the press release). This cable system, named Unity, will address increasing broadband demand by providing more capacity to sustain the unprecedented growth in data and Internet traffic between Asia and the U.S. Our participation in building Unity ultimately helps provide our users with faster and more reliable connectivity.”

And Google itself with an easy means of becoming a full-fledged network operator, if it so chooses, right? Sterin says no. “If you’re wondering whether we’re going into the undersea cable business, the answer is no,” he wrote. “We’re not competing with telecom providers, but the volume of data we need to move around the world has grown to the point where in some cases we’ve exceeded the ability traditional players can offer.”

Google declined to comment on the plan and did not confirm that it has hired the sort of submarine cable specialists that might work on it. “It should come as no surprise that Google is looking for qualified people to help secure additional network capacity,” said spokesman Barry Schnitt. “In some parts of the world, these people will work with submarine cables because there is a lot of ocean out there. … Additional infrastructure for the Internet is good for users, and there are a number of proposals to add a Pacific submarine cable. We’re not commenting on any of these plans.”

Like any network switch, the Nexus 7000 controls and directs the flow of data between connected computers. But unlike any network switch, it can transfer data at 15 terabits per second, which–depending on whatever silly illustrative metric you prefer–is fast enough to either:

• copy all the searchable Web in less than eight minutes;
• download Wikipedia’s database in 10 milliseconds;
• download 90,000 Netflix movies in less than 40 seconds;
• run 5 million concurrent high-quality videoconferences between New York and San Francisco;
• or send a two-megapixel digital photograph of CEO John Chambers to every human being on earth in 28 minutes.

The company claims it can, anyway. “It isn’t often you get to do a clean-sheet design of a system, and that is what we have done over the past four years,” Doug Gourlay, senior director of marketing in the Data Center Solutions unit at Cisco, told SearchDataCenter.com. “The Nexus series is analogous to the Toyota creating the Prius; we have created a new class of data-center switching. We made Ethernet lossless.”

Neat.

For Cisco, which is pushing to increase its presence in the data center and virtualization markets, the Nexus 7000 could be a big winner. “If it works, Cisco would mark off a hugely strategic niche for itself, as a kind of king of virtualization,” Peter Burrows writes in BusinessWeek. “That’s the name of a technology that’s risen to prominence in recent years within pockets of the data center. VMWare, for example, has become corporate tech’s new darling, thanks to software that lets companies spread work among all of their available servers, rather than have them sit idle waiting for their particular job to be called. In storage, gear from companies like Brocade plays a similar role. But until now, no company has figured out a way to easily coordinate these various pools of virtualized gear.”