The impending acquisition of Ruckus Wireless may be the one bright spot in Brocade’s rather dismal second fiscal quarter earnings, ended April 30, that the company reported yesterday.

Brocade reported second-quarter revenue of $523 million, down 4 percent year-over-year and down 9 percent sequentially from first quarter. Earnings per share were $0.22 for the quarter, flat year-over-year and down from $0.29 in the first quarter of 2016. The disappointing revenues came from both storage area networking (SAN) and IP networking.

Brocade CEO Lloyd Carney blamed the lackluster quarter on “macro” and “geopolitical” causes such as falling sales in certain regions of the world and reduced revenues from U.S. federal accounts.

Brocade is trying to transform itself from primarily a storage company to a broader networking provider. But with earnings like these, it’s questionable whether it will succeed.

But Brocade executives were bullish on the company’s upcoming $1.2 billion acquisition of Ruckus Wireless, which it expects to close within the next three months. On yesterday’s earnings call Brocade’s Carney said of the Ruckus purchase:

This transaction enhances our scale, competitive positioning in both enterprise networking and service provider markets. We also expect it to seamlessly complement our mobility strategy and enhance our ability to pursue emerging opportunities around 5G mobile services, Internet of Things, smart cities, in-building LTE, and wireless WiFi coverage.

Recently, Brocade has made moves into the software-defined networking (SDN) arena as well as into 5G. In late 2015 it announced monitoring tools to help mobile operators as they transition to more software-based networks. And in February it announced products to help mobile operators recraft their networks in anticipation of 5G.

But it looks as if its big play into wireless will be its purchase of Ruckus.

Ruckus Wireless CEO Selina Lo will join Brocade after the acquisition and head up the company’s wireless business unit. She recently told SDxCentral that she has high expectations for Ruckus’s OpenG technology, which addresses the challenge of in-building cellular coverage.

Specifically, OpenG technology combines coordinated shared spectrum, like the 3.5 GHz in the U.S., with neutral host-capable small cells to provide in-building cellular coverage. Ruckus hopes to use its ties with enterprises and service providers to drive the adoption of OpenG. And it has some powerful partners – including Google, Intel, Nokia, Qualcomm, and Federated Wireless – that are also proponents of OpenG.

“Brocade talks about helping to transform the network,” says Lo. “On the Ruckus side with OpenG, that’s another transition to 5G. OpenG will be commercialized in late 2017 onward. OpenG is a transition step, and with 5G, in-building coverage is critical.”

U.S. operators have been leading the charge into 5G, and many have been talking a lot about millimeter wave technology to boost in-building wireless coverage. However, OpenG would provide another alternative to in-building, using 3.5 GHz spectrum and a neutral-host carrier like Ruckus that will sell wholesale capacity to mobile operators.

But not everyone believes that this neutral-host carrier model will work.

Mobile Experts analyst Joe Madden believes Ruckus will need buy-in from at least one big operator, if not a group of operators, for OpenG to be a success.

“Without a big operator to lead the way, it may be a slow growth scenario,” says Madden. “Handset venders will need convincing to get involved. If there were one big player to put this system in place, those venues and enterprises may latch onto it.”

Lo says Ruckus has 260 service provider customers and is strong among cable operators. The WiFi company has federal and local government customers as well.

SDxCentral VP of Content Sue Marek contributed to this report.