Faster and More Consistent in Innovation

By Chris Preimesberger  |  Posted 2011-09-13 Print this article Print

In summarizing Cisco's outlook for the next two to three years, Chambers said, "If we do our job right, what you will find is that we will be the clear leader in the five foundational areas that determine the future of networking-and not just networking, but perhaps IT and business transformation. And we'll be doing this with mobility and security across the five areas.

"We'll be faster and more consistent in our innovation-the key word here is 'consistent,'" Chambers said. 

Chambers also said he expects Cisco to obtain 40 percent of its long-term growth from emerging markets compared with about 20 percent now.

In the meantime, Chambers said he is seeing positive signs from Cisco's existing customers. "I haven't called on a customer with Cisco in the last 120 days who isn't going to keep their spending with Cisco, or increase it," Chambers said.

Later in the day, CFO Gary Moore predicted annual sales growth of 5 percent to 7 percent by 2014, a slowdown from the range of 12 percent to 17 percent Cisco had been predicting until this year.

Chambers told analysts he plans to remain at the company for another three years. "The board of directors and the management are completely in sync," he said.

Meanwhile, the company launched three new routers for the service provider market in support of its nV virtualization package. The new products are designed to help service providers handle increases in data traffic from the huge upsurge of smartphones and tablet PCs.

HP Responds 

A day following Chambers' remarks, HP sent a statement via email to eWEEK: "Comments from Cisco today (Sept. 13) are reinforcing what we have been saying for two years: Networking is no longer a one-horse race. Clearly, the traction that HP has gained in a short period of time has made us a significant threat to Cisco.  

"Customer buying behavior of HP Networking solutions over the last two years makes it clear why anyone in the networking hardware space would identify HP as a top competitor. HP is the No. 2 networking vendor in market share by revenue in Ethernet switching, recently gaining 360 basis points in market since late 2008. HP's gain was acquired largely at the expense of the No. 1 vendor, which lost 600 basis points in marketshare over the same period, according to a recent report from Dell'Oro.

"In the third quarter of fiscal year 2011, HP reported revenue growth of 15 percent year over year for HP Networking, which is the seventh consecutive quarter of double-digit growth."

Editor's note: This article was updated 9/14/11 with Hewlett-Packard's statement.

Chris Preimesberger Chris Preimesberger was named Editor-in-Chief of Features & Analysis at eWEEK in November 2011. Previously he served eWEEK as Senior Writer, covering a range of IT sectors that include data center systems, cloud computing, storage, virtualization, green IT, e-discovery and IT governance. His blog, Storage Station, is considered a go-to information source. Chris won a national Folio Award for magazine writing in November 2011 for a cover story on and CEO-founder Marc Benioff, and he has served as a judge for the SIIA Codie Awards since 2005. In previous IT journalism, Chris was a founding editor of both IT Manager's Journal and and was managing editor of Software Development magazine. His diverse resume also includes: sportswriter for the Los Angeles Daily News, covering NCAA and NBA basketball, television critic for the Palo Alto Times Tribune, and Sports Information Director at Stanford University. He has served as a correspondent for The Associated Press, covering Stanford and NCAA tournament basketball, since 1983. He has covered a number of major events, including the 1984 Democratic National Convention, a Presidential press conference at the White House in 1993, the Emmy Awards (three times), two Rose Bowls, the Fiesta Bowl, several NCAA men's and women's basketball tournaments, a Formula One Grand Prix auto race, a heavyweight boxing championship bout (Ali vs. Spinks, 1978), and the 1985 Super Bowl. A 1975 graduate of Pepperdine University in Malibu, Calif., Chris has won more than a dozen regional and national awards for his work. He and his wife, Rebecca, have four children and reside in Redwood City, Calif.Follow on Twitter: editingwhiz

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