McDATA, Corp.

McDATA Corporation delivers storage area networking (SAN) products and services designed for large enterprises. The company primarily develops director-class Fibre Channel switches, which serve as central traffic directors, linking mainframe computers to various storage devices or connecting multiple mainframes to diverse storage systems. This technology enables the creation of unified, global enterprise data infrastructures by consolidating computer networks and integrating geographically dispersed data centers, ensuring dynamic and efficient data transfer.

The company was established in August 1982 by John F. McDonnell and five colleagues: Wil Behl, Jim Fugere, Bruce Walsh, Paul Lilly, and Gary Flauaus. The founding insight emerged when McDonnell, a former employee of Storage Technology Corporation, and his co-founders faced layoffs after a project cancellation. This prompted them to pool resources and expertise to develop their own data communications devices, initially operating out of McDonnell's garage in Colorado.

McDATA’s products cater to large organizations, distributed predominantly through a network of original equipment manufacturers, system integrators, and distributors. Its overarching vision centers on enabling a unified data infrastructure that seamlessly integrates multi-vendor, multi-protocol, and multi-location resources. This commitment ensures that vital data remains accessible and available at any time, from any location, fostering robust and adaptable enterprise data environments for its global clientele.

High-Level Overview

McDATA Corporation was a Broomfield, Colorado-based provider of high-availability storage area network (SAN) director switching devices and networking equipment that connected data storage machines to servers, enabling enterprises to build scalable, shared storage infrastructures.[1][2][3][4] It served large enterprises shifting from direct-attached storage to networked SANs amid the data-intensive Internet economy of the late 1990s and early 2000s, solving bottlenecks in data access and management for high-growth computing needs.[1][3] The company experienced explosive revenue growth—from $36.5 million in 1998 to $95.7 million in 1999, and $170.4 million in the first nine months of 2000—positioning it as the No. 2 supplier behind Brocade Communications Systems.[1]

Origin Story

Founded in 1982 by Jack McDonnell and five colleagues from Storage Technology Corp. in Louisville, Colorado, McDATA started as a spin-off focused on storage networking hardware.[1][2] McDonnell served as CEO, leading the company through its early development of fibre channel switches essential for SANs.[1] A pivotal moment came in 1995 when McDonnell sold McDATA to EMC for $234 million in stock, expanding reach but restricting sales to EMC's rivals; this ended amicably in February 2001 when EMC distributed its 81 million shares, granting independence.[1] McDATA had gone public the prior year, surging to a $900 million market value in one day, fueled by booming demand.[1]

Core Differentiators

• Specialized SAN Infrastructure: Delivered high-availability director switches for connecting storage arrays in shared networks, outperforming direct-attached setups in scalability and reliability for enterprise data centers.[1][3][4]
• Market Positioning: Ranked as the No. 2 player behind Brocade in fibre channel switches, capturing share in a rapidly expanding market driven by Internet data growth.[1]
• Post-Independence Agility: Freed from EMC ownership in 2001, enabling sales to competitors and broader customer access, which McDonnell expected to accelerate growth.[1]
• Global Footprint: Headquartered at 380 Interlocken Crescent, Broomfield, CO, with offices in Canada and Germany to support international enterprise clients.[2]

Role in the Broader Tech Landscape

McDATA rode the 1990s SAN revolution, as enterprises transitioned to shared storage networks amid exploding data demands from the Internet boom, replacing siloed direct-attached storage with efficient, centralized systems.[1][3] Timing was ideal: revenue tripled in two years as Wall Street valued its hot commodities, reflecting broader shifts in enterprise computing.[1] Favorable market forces included surging e-commerce and data-intensive apps, positioning McDATA to influence the "fiber backbone" of storage infrastructure; however, its later "quiet collapse" highlights vulnerabilities in specialized hardware amid commoditization and tech shifts like cloud computing.[3]

Quick Take & Future Outlook

McDATA's arc—from 1982 founding to 2001 independence and peak valuation—epitomizes the SAN hardware boom, but its trajectory faded as storage evolved toward software-defined and cloud-native solutions.[3] Post-2001, it likely faced consolidation (historical records note acquisition by Broadcom in 2008), underscoring risks in niche infrastructure plays. Future influence lingers in modern data center fabrics, with trends like AI-driven storage demanding resilient networking; successors build on McDATA's fibre channel legacy, tying back to its role fueling the Internet economy's data explosion.[1][3]