Cisco: It’s Not (Just) the Economy

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Part of Cisco's problem is certainly economic: The dot-com boom times are over, and the company has had to readjust to leaner and meaner days. But part of the issue is that the structure and nature of the core network is changing, and the company's product portfolio has several blind spots and holes that its competitors have taken advantage of. And as Cisco's product mix changes, VARs will have to transform themselves as well, learning new skills and picking new alliances. It is during this change that Cisco is vulnerable.

Extreme Networks' CEO Gordon Stitt sees three big trends that are driving network-infrastructure changes: First is the transformation of so-called "edge devices"--the stuff that is at the end-points of corporate networks, from traditional computers to a new collection of devices, including appliances, phones, digital cameras and the like. Second is a shift in focus toward handling real-time applications and multimedia broadcasts that will change how applications interact with the network itself and with other edge devices. Finally, it's that businesses are using their networks as competitive tools and changing the nature of how they interact with their networks as the business climate changes; expanding their reach beyond the boundaries of their networks, businesses are federating themselves with their suppliers, customers and even, to some extent, their competitors.