Cisco virtualizes

SANTA CLARA, CALIF. — At its annual analyst conference held here last month, Cisco Systems Inc. outlined a five-year vision which will, among other things, see the company aim to use its dominance in the Internet Protocol (IP) market to begin pushing the concept of services virtualization: the idea of accessing network services anytime, anywhere from any device.

Such services could include network load-balancing, mobility features used by enterprise road warriors, and security tools such as anti-spam and anti-virus tools, said Charles Giancarlo, senior vice-president, chief technology officer and president, Cisco-Linksys, LLC, during a keynote speech. “It’s possible to put new capabilities onto the network because everything is on IP,” said Giancarlo. “It’s also possible to create new applications because of this.” The aim of such virtualization, he added, is to “create a transparent end-user experience.”

Giancarlo also used the occasion of Cisco’s 20th anniversary year to point out just how far the concept of IP has come in recent times. Referring to phones and IP, for example, Giancarlo said, “There’s no differentiation anymore,” referring to his description of how the company sells its IP telephony platform. Given the increasing ubiquity of IP voice infrastructures in the enterprise, Cisco does not refer to their headsets as IP phones, but merely phones.

Also driving home the five-year forecast theme was Cisco president and CEO John Chambers, who delivered the conference’s opening keynote. He outlined the company’s objective to move its role “from being a (networking technology) evangelist” to, ‘How do we help [the enterprise customer] do it.”

In moving forward in the next few years, Cisco will aim to help customers achieve a one to two per cent gain in overall productivity through their investments in the company’s technologies, Chambers said.

Part of Cisco’s success in growing its business will be achieved by offering customers clear product roadmaps and a vision of how these can fit into a scalable, long-term IT strategy.

It is that overall strategy that Cisco will sell to customers, Chambers said, as it moves away from simply pushing individual products on their own.

“We will move away” from thinking in terms of singular products towards selling a long-term strategy, “even though it will provide advantages for competitors,” Chambers told the audience of 400 analysts and journalists.

In terms of Cisco’s competition, Chambers said that he expects “competitors will come after us with new products, particularly from Asia.’

Overall, Cisco expects its industry to grow by somewhere between 10 and 15 per cent between now and 2009.

According to one analyst, a chief Cisco challenge going forward will be to win the value-added services battle against other equipment manufacturers. “Differentiation (in the market) will come in the ability to provide services such as training, integration, application development and rollout,” said Mark Quigley of Kanata, Ont.-based Yankee Group in Canada. To a certain extent, Cisco performs that role today along with other companies such as Nortel and others, he added.

“The problem is turning that into a business model that actually generates dollars as opposed to something that is part and parcel of an overall hardware purchase.”

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