Cisco’s seven hard luck happenings in ’07

FRAMINGHAM – Even the best of us has bad days, but when a company like Cisco has them, they get widely reported. Here are Cisco Subnet ‘s picks of the top seven bad luck happenings in Ciscoland over the past year, including the departure of a high-flying exec, a wireless LAN data flooding and some major problems with Cisco VoIP equipment.

No. 7: The departure of Mike Volpi

Mike Volpi, formerly head of Cisco’s Routing and Service Provider Technology Group, surprised industry watchers when he resigned early in February. Widely tipped as the first heir apparent to CEO John Chambers, Volpi orchestrated many of the acquisitions that helped Cisco grow from a US$2 billion company to the $30 billion behemoth it is today. Volpi also was responsible for developing switching products for data centers and distribution applications during his 13-year-career at Cisco.

Several key products were under Volpi’s management, including the Catalyst 6500 and 4000 series switches, VPN and security services, and content networking. Looking at how Cisco is putting more emphasis on its consumer networking and social networking strategies today, we wonder whether Volpi would have been a good fit for Cisco now.

With his departure, Cisco’s clear hier-apparent is Chief Development Officer, Charlie Giancarlo, who last week was given the job of heading up the new Cisco Development Organization, which basically oversees all technologies coming out of the company (and it’s not clear how Giancarlo’s new role will operate next to that of the newly-installed CTO, Padmasree Warrior). Also, the ambitious Volpi would have had to wait another five years before Chambers would vacate his position.

Volpi became CEO of online video company Joost Operations in June.

No. 6:’s bad hair days

We’ve all suffered from the curse of technology but when you’re the leading networking company and customers and partners can’t access your Web site, it doesn’t look too good, PR-wise. suffered two high-profile days of intermittent service this year (there may have been other days/hours when the Web site was inaccessible but we didn’t notice).

The first blackout of the year, that we know of, happened on Aug. 8 when was inaccessible for almost 3 hours and service was spotty the rest of the day. Cisco did a good job of updating users of the problem throughout the day through its Platform blog. It issued its final statement at 10 p.m. PT, that day, blaming the problem on human error. It said: “The issue occurred during preventative maintenance of one of our data centers when a human error caused an electrical overload on the systems. This caused and other applications to go down. Because of the severity of the overload, the redundancy measures in some of the applications and power systems were impacted as well, though the system did shut down as designed to protect the people and the equipment. As a result, no data were lost and no one was injured.”

However, the updates did prompt Cisco Subnet readers to comment with incredulous disbelief that Cisco didn’t appear to have a proper disaster recovery plan in place.

The reason for the second site outage, which happened Nov. 26, remains a mystery to this day. Earlier that day, readers began pointing out to us that had been inaccessible or really slow to download. Cisco issued a statement later that afternoon, confirming that “some issues” had “impacted access to certain applications on the site.” The site remained spotty the rest of the day, with readers commenting on Cisco Subnet Community that they were still unable to access Cisco technical support documents or ordering tools. Cisco released a statement the next morning saying it had identified the cause but failed to reveal what that was.

Why was Cisco less than forthcoming with an explanation to its second outage when it had been pretty transparent during the first outage?

No. 5: Why won’t Cisco meet with the used equipment community?

If there is one subject that is guaranteed to get the Cisco community hot under the collar, it’s the used equipment marketplace. EBay and the like have a ton of hot (and the operative word is ‘hot’) deals on “genuine” Cisco equipment, while the used equipment dealers who get their gear by honest means say they are doing good business by offering products at a fraction of the cost quoted by Cisco and its resellers. Meanwhile, Cisco is working to stamp out counterfeit Cisco goods through its Cisco Capital Remarketing initiative.

In April, the United Network Equipment Dealer Association (UNEDA), which counts 300 members from the used Cisco dealer community, posted an open letter to Cisco (via the Cisco Subnet forum) asking the networking giant to meet with its directors to thrash out a way to “eradicate counterfeit and black market goods from the networking industry.” UNEDA argues that, like Cisco, it too is focused on stamping out counterfeit goods and that its members work to a code of conduct and are thrown out of UNEDA if they don’t follow the rules. But so far, Cisco has declined the invitation.

Cisco Subnet blogger, Ken Presti, who focuses on the channel thinks both parties should talk. He wrote: “I believe that opening dialogue can be a constructive step. That dialogue does not have to disclose serial numbers or other information that Cisco uses to separate the genuine from the counterfeit. So the secrets can be kept safe and the refurbished equipment program kept intact. Don’t expect any immediate miracles. But maybe there’s a way for both sides to gain some ground through discussion. Balancing Cisco’s interests with the interests of the authorized channel leaves the unauthorized channel with very little leverage — especially in view of counterfeiting and some of the unfortunate actions that have taken place in the used equipment dealer community-at-large. But while dialogue does not always lead to conflict resolution, conflict resolution always begins with dialogue.”

By refusing to meet with UNEDA is Cisco shooting itself in the foot?

No. 4: Cisco’s traditional bread-and-butter business is slowing down

The first inkling this year that Cisco is having a hard time selling its bread-and-butter enterprise equipment came in April when Barron’s Online reported on a research note written by JMP Securities analyst Samuel Wilson.

According to Wilson, Cisco sales staff had expressed concerns about making their fiscal third quarter numbers, and that many resellers believe that U.S. enterprise customers had begun to delay discretionary spending. Fast foward to November, and although Cisco posted fiscal first-quarter profit in line with estimates, it also reported that sales from its 25 largest U.S. customers had declined. Eight of those customers are financial services companies suffering from the mortgage crisis.

No. 3: Scammers using Cisco to make a quick buck

Whether you’re a famous A-list celebrity or a leading networking equipment vendor, you’re bound to get scammers trying to make a quick buck from your hard work. This year, several scammers were caught taking advantage of Cisco:

— In January, a man in Pepperell, Mass., and former worker at Hanscom Air Force Base was sentenced to more than four years in prison for scamming Cisco out of more than $4.7 million.

— In February, federal investigators arrested a 53-year-old man for allegedly efrauding Cisco. Michael Daly, whose office is in Salisbury, Mass., was accused of using fake business names and addresses in at least 39 states to make about 700 false claims of defective products for which Cisco sent replacements. After getting the replacement products, Daly sold them on the Internet for profit, according to a news release from the FBI.

— In March, a computer technician was arrested on charges with defrauding Cisco of more than $10 million by cheating one of the vendor’s programs for replacing broken or defective parts.

No. 2: Cisco VoIP: The bad and the ugly

As fast as Cisco’s marketing team is pushing its unified communications strategy to the market Cisco’s security team is issuing security advisories and responses related to its VoIP products – we counted seven in the past year (Cisco security advisories here; Cisco security responses here). Perhaps the most significant is the revelation that it is possible to eavesdrop on remote conversations using Cisco VoIP phones. Cisco confirmed late November that: “… an attacker with valid Extension Mobility authentication credentials could cause a Cisco Unified IP Phone configured to use the Extension Mobility feature to transmit or receive a Real-Time Transport Protocol (RTP) audio stream.”

The revelation followed reports a month earlier that two security experts at hacker conference ToorCon9 in San Diego hacked into their hotel’s corporate network using a Cisco VoIP phone.

No. 1: Duke University’s Wi-Fi data flooding: Was the culprit Apple’s iPhone or Cisco’s network equipment?

On July 14, Network World reported that the Wi-Fi connection on Apple’s iPhone appeared to be the source of a big headache for network administrators at Duke University. Network administrators there witnessed dozens of access points being knocked out as the devices were flooded with 180,000 requests per second from Apple’s mobile device. The story ignited a tidal wave of interest among IT professionals and bloggers on the Internet.

On July 20, Cisco confirmed the problem was caused by a Cisco network issue and later that month, it issued a security advisory detailing what caused the address storms. According to the advisory, Cisco’s wireless LAN controllers have “multiple vulnerabilities in the handling of Address Resolution Protocol (ARP) packets.” These vulnerabilities “could result in a denial of service (DoS) in certain environments.” The vendor offered free software to patch this problem, and noted that “there are workarounds to mitigate the effects of these vulnerabilities.”

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