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Onstage at VMware’s VMworld conference in San Francisco last week, it looked like the software company had already gotten lots of mileage out of its $1.26 billion acquisition of Nicira. Martìn Casado, a cofounder of Nicira, spoke confidently of the new capabilities administrators will gain from the NSX network-virtualization software launched at the conference and suggested that it will increase efficiency and agility inside customers’ data centers.

“There’s a lot of problems in networking as you try to push them [networks] into the cloud era. My passion is really making networks cloud-ready,” Casado said. Casado is highly respected in networking circles for his contributions to the breakthrough OpenFlow networking protocol for controlling packet movement through server-based software and the software-defined networking industry in general.

But looking ahead, Casado’s got work to do. He’ll be developing the product further in the months to come, he said in an interview with VentureBeat on the VMworld exhibition floor. And he will have to keep articulating its value to customers in order for VMware to get sufficient return on its investment in Nicira.

Leaving aside the matter of how Casado will spend his time at VMware, though, NSX represents a step in a wise direction for the company. VMware became successful in the early 2000s by giving customers an ESX hypervisor, which virtualizes servers through software and enables applications to run in multiple virtual machines on each physical server. Casado explained how NSX will enable administrators to create virtual networks in a similar fashion, atop existing physical compute and networking gear. That’s an important step forward in delivering applications faster. The new software promises agility — the capability to implement multiple virtual networks and key functions like firewalls and load balancers quickly and without physical configuration. Cost reduction, though, is not a given.

In front of an audience of 22,000, Casado conversed with beta users from companies like eBay, Citi, and GE, and audience members had opportunities to gawk at NSX screenshots for the first time. Some conference attendees sounded impressed with the new networking capabilities they will get through NSX, or at least with Casado’s intelligence.

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While NSX was one of many products VMware rolled out last week — alongside the vCloud Hybrid Service public-cloud offering, a new vSAN storage-virtualization product, and a new version of vSphere server-virtualization software — the critical networking piece of VMware’s big-picture software-defined data center strategy is coming into sharper focus, and the big bucks VMware shelled out for Nicira are starting to pay off. Casado’s schedule during the conference was flush with customer meetings.

Even so, system administrators and network geeks have a few reasons to hold off on talking to their bosses about this software.

For one thing, the prices aren’t out yet, as Gartner analysts Joe Skorupa and Andrew Lerner pointed out.

Interestingly, VMware stock took a plunge on the first day of the conference. In his keynote, Casado came off like a genius who was humbly lending his innovations to VMware, and chief executive Pat Gelsinger boasted of the company’s execution on its vision for a software-defined data center — all servers virtualized, with the capability to control compute, storage, and networking programmatically. Even so, apparently investors were not impressed.

Additionally, Casado himself noted in a technical session that the customers on stage during the first day’s keynote were not using a complete NSX product but rather some kind of precursor.

It’s unclear exactly how the software they were using will differ from the NSX product that will hit general availability later this year. But we do know that Casado and his team are cooking up additional features for NSX. It sounds like they could give administrators still smarter virtual networks and more control.

Casado said he wants to introduce the capability to configure networks for multiple sites, not just a single data center.

“If you have two controllers in different sites, you want to expose one abstraction at a high level, even if you’re in totally different data centers,” he said. “Today, you have to talk to both controllers.”

And handling network flows intelligently as they move around a data center is another work in progress. That way, whenever a big flow of traffic moves, the network must understand that and then route it in an appropriate way, rather than it would with a little workload.

Casado likened the small flows to mice and big ones to elephants. “If we can identify the elephants and label them as elephants and then treat them differently, I think it will allow you to build much more efficient physical networks,” he said.

Simplifying the process of setting and implementing workloads’ business and security policies is another area of focus, as is integration with MPLS networks, Casado said.

Analysts are uncertain about how well NSX will do among enterprises, with or without the coming features Casado spoke of. So far, enterprises have been rather slow to take up software-defined networking technology. Time will tell if it will become a standard in enterprise data centers and not just among cloud providers.

For now, Casado will return to the drawing board to further develop the product. Sales and marketing will have to wait.

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