Asked why it would take five years to realize this vision, Lloyd said it’s a long term vision. But it should allow Cisco customers to unlock value they have in their existing network infrastructure he said by coming up with new ways of taking advantage of applications and business processes.
Companies such as Cisco, Juniper Networks, Brocade Communications, Alcatel-Lucent and VMware are only just firming up their SDN strategies. There isn’t even complete agreement on what SDN means, although most say it is a way of separating network control plane from the data plane, which forward traffic. Through software, there would be central control of traffic.
Some, Lloyd noted, have predicted that SDN is a threat to hardware-based network equipment makers like Cisco – or, as he put it, see SDN as “the ultimate threat and the final kneecap to Cisco.”
But the company believes SDN “is actually potentially a huge advantage if we unlock the value of $180 billion of (Cisco’s) install base by creating some APIs and interaction to the intelligence we’ve built (in the network) and begin to expose that to applications and business processes.”
In fact Lloyd and Patel took pains to remind the reporters that Cisco is heavily into software, planning do double its annual software revenue over the next five years to $12 billion and grow its service business to at least 25 per cent of revenues, up from 22 per cent.
Also on the call Lloyd said that this year Cisco will simplify licencing of its various communications applications. Cisco offers the cloud-based WebEx audio and video collaboration service, as well as on-premise Unified Communications suite, Contact Centre and Call Centre applications.
“We’re hearing from customers and partners that the separate licencing mechanism that exists for those should be combined,” Lloyd said. So the goal will be to decrease the number of enterprise licence agreements to simplify the way customers can buy Cisco collaboration, “and totally compress the number of licencing and renewal fees”