Strategic CIO // Executive Insights & Innovation
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11/15/2013
08:00 AM
Rob Preston
Rob Preston
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Cisco's Chambers: Rival White Box Model 'Fatally Flawed'

In a wide-ranging interview, the Cisco CEO acknowledges an industry battle ahead but insists his company's architectural approach will prevail.

Chambers: 'This is the biggest move we've made and will have the most industry impact.'
Chambers: "This is the biggest move we've made and will have the most industry impact."

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RobPreston
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RobPreston,
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11/15/2013 | 8:45:06 AM
Don't Underestimate Cisco
People have underestimated Cisco before, and almost always its vision and execution prevail. It has certainly made mistakes (like the Flip dalliance), but it realizes its mistakes and moves on better than most big IT vendors.  
David F. Carr
IW Pick
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David F. Carr,
User Rank: Author
11/15/2013 | 10:50:40 AM
SDN intriguing but challenging
He may have a point that the wave of open technologies for SDN and network architectures will require more effort to implement and more "being your own systems integrator" than most organizations want to take on. Google, Facebook, and major financial services firms may be willing to put the effort into defining a custom network architecture that gives them a few extra percentage points of efficiency. How much of the rest of industry will go that far?
aditshar
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aditshar,
User Rank: Apprentice
11/16/2013 | 3:43:20 PM
Re: SDN intriguing but challenging
I read a report couple of days back, wherein according gartner, cisco's ACI delivers tactical benefits but lacks strategic value of SDN, and here i feel Juniper take one step win from cisco.
virsingh211
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virsingh211,
User Rank: Strategist
11/16/2013 | 4:25:07 PM
Re: SDN intriguing but challenging
I am with you on this point aditshar, Cisco is no more limited to single domain now they expanded themselves to lot more industries after netwroking, Juniper no doubt is doing good in netwroking devices,

What do [customers] want out of SDN? Programmability, virtualization, and the ease of bringing applications.


At this point of time, this is even question for customers i.e. what they want out of SDN, so i dont think any point to be in hurry whats required is education on SDN to make customer understand the need and realize the importance.
Susan Fogarty
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Susan Fogarty,
User Rank: Author
11/15/2013 | 10:57:18 AM
Re: Don't Underestimate Cisco
Insightful piece. Cisco has done remarkably well keeping ahead of the game, especially when you consider the dramatic technology changes and economic challenges of the last decade. I think Chambers may be underestimating the importance of software here, however. It's interesting that Cisco pooh-poohed the concept of overlay networks, but then included them in ACI anyway. Customers will be slow to go fully SDN, and I think overlays and white boxes will be fairly popular to try it out.
Tom Murphy
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Tom Murphy,
User Rank: Author
11/15/2013 | 4:25:13 PM
Re: Don't Underestimate Cisco
SueNWC:  I hear you. The way Chambers downplays SDN by saying Cisco has already tried that reminds me of the way Kodak said digital cameras would never undermine its film business (after EK invented the digital camera.) 

Hey, Mr. Chambers, have you tried to buy a roll of Kodachrome lately?
RobPreston
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RobPreston,
User Rank: Author
11/18/2013 | 12:25:54 PM
Re: Don't Underestimate Cisco
In response to Murphy et al, Chambers isn't quite saying "it already tried" SDN. It's saying its SDN implementation, in which both the hardware and software matter, is the superior way forward. Some will disagree, of course, but Cisco isn't just dismissing SDN. 
Tom Murphy
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Tom Murphy,
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11/18/2013 | 12:40:13 PM
Re: Don't Underestimate Cisco
Rob, thanks. I shudda said Chambers thinks SDN overlays are "impossible" because Cisco's army of 25,000 programmers hasn't been able to make that work.  (Naturally, the company wants to promote a proprietary system.)  

I still think it's too early in the SDN game to say anything is impossible. What do other readers think?

 
Tom Murphy
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Tom Murphy,
User Rank: Author
11/15/2013 | 4:35:18 PM
Re: Don't Underestimate Cisco
Hey, don't knock the Flip! Not only did it inspire a lot of imitators and phone cams (I have a remarkably good Flip-lookalike made by Kodak. Yep, that Kodak.), but it cudda-shudda been a contender for the explosion in video networking.  That revolution is still rising, and I wouldn't be surprised to see Cisco back in the Flip business before long. 

Flips work in ways that phones can't, and they are in hot demand among indy media devotees. Here, for example, is an aging Flip selling for $120 on Craigslist. What would you pay for, say, an iPhone 2? Nothing)  That's not bad considering an iPhone 5 fetches about $100.

What do others think: was Cisco's vision for video conferencing just ahead of its time?
Susan Fogarty
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Susan Fogarty,
User Rank: Author
11/15/2013 | 5:33:50 PM
Re: Don't Underestimate Cisco
Tom, everything you say about the Flip is true. It's a great device and I still use mine, both for work and home. However, I don't think it fit into Cisco's overall strategic plan or helped enterprise videoconferencing. Telepresence, now that's another matter...
Tom Murphy
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Tom Murphy,
User Rank: Author
11/15/2013 | 5:57:27 PM
Re: Don't Underestimate Cisco
Sue (why do I feel like we should be teleconferencing?),  I think we're on the same wavelength.  Any form of networked video shows the power of Cisco's systems -- something they must have realized years ago when designing the first Flips.  And until further notice, video starts with a video camera.

It reminds me of when Sun started playing around with PDAs, many many years before the first iPod prototype was built by Apple.  They were on the right track, just a decade or so too soon.
jgherbert
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jgherbert,
User Rank: Ninja
11/17/2013 | 4:36:37 PM
Re: Don't Underestimate Cisco
"What do others think: was Cisco's vision for video conferencing just ahead of its time?"

Perhaps, but I also get the impression that they have an idealistic view of how people will take to videoconferencing in its many forms. The Cius was a ridiculous product trying to merge video conferencing, tablet computing and more into a device that you could dock on the desk. Unsurprisingly it didn't succeed. Telepresence is fantastic, without question. The Flip was a genuis device; it met a market need perfectly, and even when Cisco was busy removing Flip from their portfolio, the demand was still high. And then there's the Ava 500 which leaves me sighing and saying "WHAT WERE YOU THINKING?" Or perhaps they really do know the market better than I do, and Robbie the Robot is selling like hotcakes. 

The sad reality is that Flip was a consumer product, and Cisco shoud not have tried to play in the consumer space where you stack 'em high and sell 'em low (cf: Linksys), because that just isn't how Cisco works.
kelleyd1
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kelleyd1,
User Rank: Apprentice
11/17/2013 | 3:13:54 PM
Re: Don't Underestimate Cisco
I agree. The industry almost revels in Cisco's missteps. But Cisco quickly reacts, makes the tough choices and admits to mistakes much faster than any other industry leader. About three to four years ago they had a big supply chain issue where customers couldn't get their core products. They quickly mobilized the right people and rectified the situation. When they entered into too many adjacent markets (like the Flip) and lost their focus, they refocused on their core strengths. I think Chambers will go down as one of the greatest high-tech CEOs. 
Lorna Garey
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Lorna Garey,
User Rank: Author
11/15/2013 | 12:06:26 PM
CEOs Vs. Politicians
At some point, do you feel that a CEO on the level of Chambers (or Ellison, or Meyer) is ever going to go off script? Often listening to them reminds me forcibly of the politicians on Meet the Press who cannot be lured awy from their talking points. Essentially you're getting a summary of the company's press releases, delivered in a smooth and practiced way. They could deploy a robot to do the same thing.
Tom Murphy
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Tom Murphy,
User Rank: Author
11/15/2013 | 4:22:42 PM
Re: CEOs Vs. Politicians
I'm with you, Lorna. I'll give Chambers an Academy Award for most consistent performance by a CEO.  But out in the real world, where savvy tech-sector analysts are betting trillions of dollars of our retirement savings, Cisco has a tough audience. Sure, the stock is up about 50% from it's 2010 low, but that's not exactly a rocketship in the tech sector.  And, besides, it has only climbed back to the low 20s -- about where it was in late 2009.  In the markets, that's called "dead money" and the company's Nov. 13 admission that revenue is soft isn't helping. 
cbabcock
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cbabcock,
User Rank: Strategist
11/15/2013 | 3:46:50 PM
It's Cisco versus the cloud
Cisco keeps coming up with sophisticated hardware to solve another layer of the problem. The Application Policy Infrastructure Controller is a software controller for the hardware of a UCS system, which combines compute and networking for a given, virtualized UCS rack. This is an evolutionary step when we appear to be in the midst of a revolution. We're building cloud systems out of components, then we're treating compute, storage and networking as flexible parts of a single whole. The single whole Cisco is talking about, hardware constrained as it is, is the largest unit of UCS it can produce. Theoretically, with a cloud architecture, hardware isn't allowed to impose that constraint and we can assign the appropriate network to as many applications as we need to.(We're not there yet but stay tuned.)
jgherbert
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jgherbert,
User Rank: Ninja
11/17/2013 | 4:30:31 PM
There Will Be A Battle Here
"There Will Be a Battle Here"

No kidding; and battles are bad for business. Customers have a habit of hanging back when there's not a certainty about the technology of choice going forward, and right now there are so many options on the table, it's hard to know which to select in order not to be left out of the game 3 years down the line. You've only got to look at the BluRay/HD-DVD mess to understand why sometimes choice might be a bad thing. The one thing Cisco has going for it is that "nobody ever got fired for buying Cisco" (a saying that used to be ascribed to IBM).

Is ACI a sufficient play to keep them in place, especially when they've effectively done yet another bait and switch on the "platform of the future" by introducing the Nexus 9k?
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