New wireless player wants 30 per cent of SA market

Fifteen months ago, Cisco Systems Inc. acquired wireless equipment vendor, Linksys, in an attempt to boost its solution offerings to cater for the SoHo and consumer wireless networking market. According to David Kelly, EMEA director for sales at Cisco Systems, which was in South Africa (SA) last week for the launch of the brand in the country, since Linksys is already an established brand, Cisco has kept it intact.

In a market that is clearly highly commoditized, Linksys seems to be optimistic when it says that it is aiming for 30 per cent of the local market share after 18 months. “There are a lot of good competitors out in the market,” Kelly says, “but we believe that the overall value proposition that Linksys will bring to the market will differentiate the product portfolio.”

The recent liberalization of the telecoms market, and the imminent announcement of SA’s second network operator (SNO) — we hope, Ed! — should see a drop in the cost of connections to the Internet and bandwidth costs, as well as an increased adoption of broadband in the home, prompting a higher demand for richer, more diverse multimedia applications to be delivered directly to the home or small office.

Kelly says that Linksys has positioned itself to be able to offer a platform to deliver these applications to consumers and small businesses, rather than just being another Internet gateway.

“The product portfolio includes media adaptors, wireless IP cameras and wireless disk-based storage, to name but a few,” comments Mohammed Meraj Hoda, Cisco’s regional manager for EMEA.

Whether Linksys can gain 30 per cent of the local market, time will only really tell. However, the company has a solid track record in North America, and, according to Hoda, it has jumped to the number one spot in the Middle East, overtaking competitors such as 3Com Corp. and U.S. Robotics Corp. in six months.

Locally, the products will be available to the channel through Comstor, while Comztek SA will be taking care of Linksys’ retail interests. “We will be on a major marketing drive to create awareness of the Linksys brand and its association with Cisco,” Hoda comments.

Resellers need not be accredited Cisco resellers to make the Linksys products available to clients, the company adds. There will be a VAR program up and running shortly, where resellers can register online as a Linksys reseller.

“There will be a clear differentiation between what products will be available to VARs and which will go into the retail market,” Kelly says. As far as the rest of Africa goes, Cisco seems determined to have the SA market pegged first. “But expansion into Africa would be the next phase of our product roll-out,” Kelly adds.

Linksys seems to have a winning combination of functional product and association with the Cisco brand at an attractive price-point. However, as mentioned before, the commoditized market could prove a bit of a challenge.

Linksys will just have to make sure that it can deliver on the hype it intends to create about its products, if it intends to encroach on a market clearly dominated by the likes of D-Link Systems Inc., Freecom and SMC.

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