{"id":3373,"date":"2010-08-13T19:10:02","date_gmt":"2010-08-13T23:10:02","guid":{"rendered":"http:\/\/rbach.net\/blog\/?p=3373"},"modified":"2022-12-30T15:27:24","modified_gmt":"2022-12-30T20:27:24","slug":"another-tech-loss-for-michigan","status":"publish","type":"post","link":"https:\/\/rbach.net\/index.php\/another-tech-loss-for-michigan\/","title":{"rendered":"Another Tech Loss for Michigan?"},"content":{"rendered":"

\"Another<\/a>Earlier this week Texas-based Tektronix Communications<\/a> announced it had acquired Arbor Networks<\/a>, which makes software for network security and management. Arbor Networks employs about 90 people in Ann Arbor<\/a> and 270 worldwide. According to Xconomy-Boston<\/em><\/a>. Farnam Jahanian, who is chair of computer science and engineering at the University of Michigan<\/a>, formed Arbor Networks in 2000 with\u00a0Rob Malan, who was Jahanian\u2019s Ph.D. student at the U-M and is now Arbor\u2019s chief technology officer (he will stay on as CTO).<\/p>\n

\"\"<\/a>Arbor Network’s core technology, based on Malan\u2019s and Jahanian\u2019s research, involves software that monitors entire computer networks, from data centers and Internet service providers<\/a> to broadband customers and mobile interfaces. According to the article, the firm’s products protect its customers against all manner of security threats, most notably, denial-of-service attacks that can shut down big networks and popular websites. Jahanian and Malan\u2019s team raised a Series A venture round in 2000, led by Battery Ventures and Cisco Systems, and then a Series B round in 2002, led by Thomas Weisel Venture Partners. Those two rounds, the only outside funding taken by the company, were worth about $33 million.<\/p>\n

Arbor CEO, Colin Doherty, told Xconomy-Boston<\/em> that Danaher<\/a> (NYSE: DHR<\/a>), a Washington D.C.-based technology conglomerate, owns Tektronix Communications. According to Doherty, Arbor will stay \u201cwhole and intact as an operating unit under the Danaher brand.\u201d The company will become part of Danaher\u2019s communications and enterprise group which comprises a half-dozen companies, including Tektronix Communications, Fluke Networks<\/a>, and AirMagnet<\/a>.<\/p>\n

\"\"<\/a>Arbor will give its new parent company deep Internet security knowledge, what Doherty calls a \u201csecurity beachhead.\u201d Now \u201cthey can detect, secure, and mitigate network security. It was a really good fit for them,\u201d he says. Doherty told xconomy.com <\/em>that with Danaher\u2019s size and influence, \u201cit\u2019s a unique opportunity for us to change our model\u2026and be part of a larger public vehicle.\u201d Financial terms of the deal weren\u2019t disclosed, and the principals at Arbor and Danaher weren\u2019t saying much beyond the platitudes that typically follow such a merger.<\/p>\n

For his part, Jahanian who is exiting the company calls the Danaher acquisition a natural next step in Arbor\u2019s broader evolution. \u201cIt\u2019s another inflection point,\u201d he said in the article, and it will help the firm \u201cexpand into a new emerging market.<\/em>\u201d David Munson, the dean of engineering at the University of Michigan, says he is \u201cheartened that the acquisition of Arbor Networks calls for Arbor\u2019s research and development activity to remain in Ann Arbor. This is a cornerstone for Ann Arbor\u2019s rapidly developing software and networking industry<\/em>\u201d in the article.<\/p>\n

Doherty did not offer Xconomy.com<\/em> many specifics on the new firm’s commitment to Michigan, other than the usual corporate platitudes that Arbor will \u201ccontinue to grow our presence in Ann Arbor and in Chelmsford (MA).\u201d However, even the U-M professor admits Michigan does not cut it for big-time Tech. \u201cWe knew we could build a phenomenal R&D team in Ann Arbor,<\/em>\u201d Jahanian says. \u201cBut to recruit the quality of executives [we wanted], we had to be either on the East or West Coast<\/em>.\u201d The combination of Battery Ventures being in the Boston area, the strong local business talent, and proximity to the East Coast\u2019s big wireless carriers and Internet service providers swung the decision in Boston\u2019s favor, he told Xconomy.com<\/em>.<\/p>\n

rb-<\/em><\/strong><\/p>\n

From where I sit, the DHR product lines seem to be a good match for Arbor’s, but it is only a matter of time before the bean-counters in charge at DHR decide that even a “phenomenal R&D team in Ann Arbor\u201d is too expensive and Michigan <\/em>(and the US) will lose 90 more leading-edge, well-paying jobs.\u00a0 Another example of how tech unaware Michigan is that Xconomy-Detroit<\/a> did not cover this, the article came from Boston.<\/em><\/p>\n

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