International Business Machines Corp. (NYSE:IBM) has bought Blade Network Technologies. Blade makes server software, blade servers, and rack switches. The two companies have already been partners and IBM will add more Blade technology to their servers. [ZDNet]

BLADE Network Technologies is a server and data center switch company that competes with Cisco Systems.  BLADE Network Technologies raised $10 million in funding led by NEC and Juniper Networks.  Garnett & Helfrich Capital, the initial investor in Blade Network also participated in this round. Blade has raised $40 million in total funding thus far.

BLADE Network is led by CEO Vikram Mehta.  Mehta said that BLADE was able to effectively compete against Cisco and 3Com because hardware does not cost much these days.  “Our real story is software” stated Mehta in an interview with VentureBeat. Based on this round of funding, BLADE is valuated at $230 million.