Ciscos Future: Smarter Nets

 
 
By Paula Musich  |  Posted 2004-12-13 Email Print this article Print
 
 
 
 
 
 
 

With its benchmark anniversary celebration behind it, the company anticipates major growth in top technology areas, according to CEO John Chambers.

Despite the tough it spending environment, networking company Cisco Systems Inc. celebrated its 20th anniversary last week with hopes of double-digit growth in several key technology areas including security, storage and IP telephony. President and CEO John Chambers last week sat down with eWEEK Senior Editor Paula Musich to discuss Ciscos progress in building out what it sees as its six high-growth areas and where the San Jose, Calif., company is headed beyond that.

In what area is Cisco growing fastest?

Storage has the fastest growth rate but also the lowest base. So in an industry growing 10 to 14 percent, were growing over 150 percent, and we moved into the No. 3 position in the industry.

Its interesting that whats gaining a lot of momentum is how customers expect all technologies to play together: security across [the whole environment], how storage participates in the home environment, how wired and wireless come together. All are doing very well.

Click here to read about new products from Cisco that help users transport storage traffic over metro and wide area networks. Perhaps the biggest growth factor for us is a combination technology architecture, where networks go from wired to wireless, enterprise to service provider, cable to commercial, and hot spots will all come together and, with intelligence, be almost completely transparent in terms of virtualization of services and resources. Whether the device is on your desk or in your hand, whether the application is processed there [or elsewhere], whether the storage is inside your office or in your data center—you will have transparency. Cisco is attempting to lead in each of the [advanced] technology areas. No company in history has been the No. 1 player for any sustained period of time in more than two major product areas. Weve a very good chance of doing this.

Were going to see if we can accelerate [growth] by helping customers understand how to apply technology with a lower cost of ownership and higher investment protection in an architectural way, and show how to make the business and process changes that are needed to pay for these investments—and how to get payback quicker so you can do more of them.

Youve said each high-growth area has the potential to be a $1 billion business. Which area has already hit that mark, and which is approaching it?

Security is currently on a $1 billion run rate. Theres an exciting race going on now between home networking, IP telephony and wireless. Even optical is growing again in terms of key deals. But with the three in a dead heat, the question becomes: Can we take four products to $2 billion? All of them wont hit. But if they all do, I didnt take enough risk—I should have done more.

Part of it is being at the right spot at the right time, which were trying not to mess up. But our ability to move into an area like IP telephony, which nobody associated with us, and potentially become the No. 1 player has never been done before.

Youve hinted at four or five other areas Cisco is thinking about moving into. What are they?

Ill talk about one. Im not trying to be secretive, but theres no reason to bring it to your customers before its ready. We think our next major moves are going to be in the data center. And theres a lot of implications with that, from application-aware networks to the virtualization of storage and processing power and applications. You arent going to know whats on that device in your hand or on your PC—whether the processing power is resident there or [in] the application or the security or the storage, or whether its at the edge or in the data center. That also shows why we need to be in the data center.

Next page: An arms-length approach to services.



 
 
 
 
 
 
 
 
 
 
 

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