HP today announced its intention to purchase Aruba Networks, its key competitor in the emerging field of wireless network manageability for smaller businesses, in an all-cash transaction deal valued at $3 billion in equity. The move brings easily the most innovative system for self-provisioning of wireless networks by non-professionals under the HP banner.

HP’s statement that the deal would provide it with tools that “complement” its existing product line, is a tacit admission that its 2014 effort to achieve parity with Aruba in this field was not all that successful.

The Growing Virtue of Virtual

To understand why this deal is important, we need to look at the relevance of Aruba’s technology in the context of a quickly changing landscape.

Software-Defined Networking (SDN) is essentially about bringing formerly separate hardware components inside servers. Access points (AP) that used to be separate boxes are now being virtualized in software. One of those components is the network controller, which in SDN can be controlled by the server’s processor.

Aruba produces a type of virtual controller system for Wi-Fi networks. You can’t virtualize a Wi-Fi transmitter yet, so it still manufactures wireless access points, which you could easily mistake for smoke detectors.

You install these APs throughout the office the same way you would Wi-Fi routers, as explained in this Aruba Networks video [YouTube]. One of these APs in the cluster acts as the virtual controller, and it may not even matter which — when one goes down, another takes over.

The software-based portal runs from a Web browser, which of course can be run from a smartphone or tablet. So if the CMO of a company happens to also be the designated CIO, she can take charge of the network from her pocket.

The idea is to let smaller businesses place APs throughout the building wherever it’s convenient, and let management software determine how best to utilize them.

This way, businesses no longer have to determine which domain is best for them to run their critical applications, based on such factors as which server PC is closest to the person designated to manage those applications. Those apps could move to the cloud, so the network can be designed around providing its users with the clearest signals.

The Uncertain Virtue of Scale

Aruba’s management portal, Aruba Central, was launched in October 2013. Immediately, it offered not only availability to network recovery services during a power event or a weather event, but it also prompted customers to utilize enterprise-grade firewalls, introducing security techniques to businesses that never understood them before.

HP had its own wireless LAN system, called Cloud Managed Networking, which it had built out in 2014 in an effort to be more competitive against Aruba. At first, analysts were impressed, citing HP’s ability to provide services quickly to a wide range of customers — a virtue they refer to as “scale.”

But scale may only be a virtue when the product being scaled is superior. In terms of market share, the leader in this space remains Cisco. When rumors of an Aruba buyout by HP first appeared last week, it was clear investors believed an HP + Aruba combination could very effectively compete against Cisco head-to-head.

According to HP’s announcement Monday, the Aruba brand will remain visible as part of the HP Enterprise portfolio, especially after HP’s planned division into two firms. Current Aruba management, including CEO Dominic Orr and CTO Keerti Melkote, will lead the new HP division.

Although the announcement does not make this clear, it may not have to:  Existing HP wireless LAN customers will probably be transitioned to the Aruba system after the rebranding. This, of course, assumes the deal is approved by regulators.

Barring no challenges, HP expects the deal to close in the second half of its fiscal 2015, which would mean before October.