Cisco Powers Into Smart Grid

Cisco has decided to take a vertical approach with its network equipment. The company has designed a new switch and a new router designed to work in utility companies smart grids. The announcement underscores the vendors desire to diversify as it attempts to continue its rapid revenue growth.The new products fall under the Connected Grid banner: the Connected Grid Router 2010 (CGR 2010) and Connected Grid Switch 2520 (CGR 2520). They are based on existing Cisco products for enterprise networks and run the companys IOS software, but support power utility-specific standards and protocols, such as SCADA (Supervisory Control And Data Acquisition).

The devices include a number of security features, so they comply with North American Electric Reliability Corp./ Critical Infrastructure Protection (NERC/CIP) standards. For instance, they feature the Cisco Intrusion Prevention System, Cisco Network Access Control, Multiprotocol Label Switching, virtual private networks, firewalls, user/device identity, and access control capabilities. In addition, the network gear can be integrated with IP-based physical security solutions, such as physical access control to premise and video surveillance. Finally, the products meet IEEE 1613 and IEC61850-3 standards, such as the ability to withstand a broad range of temperatures and protection against electrical surges and electromagnetic interference. Pricing for each product starts at about $6,000.

The announcement will probably not impact many small and medium businesses directly, however, it does illustrate the transformation that Cisco is trying to make as the network equipment market evolves. With network equipment becoming more commoditized, the company has been trying to branch into new areas. The vendor is not only developing special utility network equipment, but it has also been working on energy management with its EnergyWise system.

The Goliath needs to make such changes in order to maintain its traditional, lofty revenue growth. But, diversification does bring new risks. The vendor could not fare well in its new ventures. Small and medium businesses may be concerned because the company could lose focus on its networking products. Historically, Cisco has been a safe selection for small and medium businesses, but with its new, broader outlook, the company may no longer be the sure bet that it has been.