Cisco Partner Executive On HPE's Innovation Problem, Why AWS 'Helps Our Industry Move Forward,' And Cisco's Hardware-Software Disaggregation

Sheth: Competitors Just Making 'Noise'

Fresh off the revolutionary launch of its Intuitive Network platform, Cisco partner leader Nirav Sheth says competitions like Hewlett Packard Enterprise and Arista Networks can't compete on the same innovation or end-to-end architecture level as the networking giant.

"If you look at the recent announcements from HPE or others, it's all point solutions, point products. Nobody is embedding in the security and nobody is looking at it from an architectural point of view in terms of how does a customer have to operate their environment," said Sheth, vice president and leader of Solutions, Architectures & Engineering for Cisco's Global Partner Organization, in an interview with CRN. "So what do they try to do? They try to make noise on something else … If I look at a competitor like HPE, they're not really innovating."

Sheth also talks to CRN about why innovation at AWS 'helps our industry move forward," Cisco's new IOS and the margin rich partner opportunities through its new networking platform.

What makes Cisco's Intuitive Network strategy different from anybody else in the networking industry?

The reason why we've seen so much adoption of DNA and the reason why we're different, is because it truly is an end-to-end strategy, an end-to end architecture. If you look at the recent announcements from HPE or others, it's all point solutions, point products. Nobody is embedding in the security and nobody is looking at it from an architectural point of view in terms of how does a customer have to operate their environment.

Nobody else in the industry can do this because nobody else is taking the architecture end-to-end approach that we are, and doing it ground up with security built in. That's why we also see some of the hype we do from our competitors because they know they're not able to address a customer's end-to-end strategy and a customer's end-to-end operational environment.

Explain how competitors can't offer a true end-to-end solution like Cisco?

If you think about a customer's core, you're talking about campus core, campus aggregation, campus access – which also spans out to campus wireless – and you got to secure all of that both at the perimeter and then internally as well. Then how do you also segment everything that's coming onto the network? It's not just about the users that are on the network, but it's all this stuff – your camera or any device that needs connectivity. Nobody else can offer it from a networking and security perspective from the ground up.

So what do they try to do? They try to make noise on something else where they think it's not something we're focused on, but little do they know because they're not paying attention, we're doing all of that stuff as well.

Your new Intuitive Network seems to be a lot of proprietary Cisco solutions. With competitors like Dell, Arista and Juniper disaggregating hardware from software and taking a more open networking approach, is this still the right path for Cisco to be going down?

This isn't a unique thing that a Juniper [Networks] or an Arista [Networks] or someone else is doing. We've been doing this for some time now, where we've been offering virtualized flavors of our products like virtualized firewalls, which is disaggregating the firewalls software from the hardware and enabling a customer to put that in their private or public cloud environment.

Another example would be our cloud-services router – it's essentially a virtual IOS router that a customer can deploy on their public cloud environment. Let's say Amazon Web Services. We already disaggregate … We're always ready to entertain scenarios like that to meet our customers' needs.

How does this end-to-end architecture give Cisco partners a leg up over the competition?

Partners are going to continue to win more with us because we're turning that network discussion now into a business discussion. Everyone else is bells-and-whistle features … versus 'Do you want a more secure experience? Do you want a more optimized SaaS experience? Do you want to reduce the cost of your IT operations? How do you want to segment your environment so that, as you bring in sensors and cameras and other non-traditional devices onto the network, you're protecting the rest of your environment. These are all fundamentally business conversations that start at the C-suite, and not 'Hey we have a new 40-Gig switch'. We can also have that conversation as well, but we're seeing our competitors coming bottom up. And because we have the end-to-end story line and architecture, partners can go top down and they can't do that with any of our competitors.

Amazon is making big moves across various industries, as we just saw with its acquisition of Whole Foods. Where does Cisco stand right now with AWS?

If I look at a competitor like HPE, they're not really innovating. They're sort of financially engineering stuff. Then they finally realized [after] a lot of financial engineering, they have to now focus on product again.

If I look at AWS, I don’t view AWS as a competitor, I view AWS much more as a partner and they're a great customer of ours. I really applaud AWS for how they're consistently innovating in the market. Whether it's their AWS [product] line, or what they're doing from a retail point of view – Amazon as a company is a great innovator. Cisco is a great innovator too. When a great company and partner and customer like Amazon innovates, it helps our industry move forward.

Can you describe Cisco's technology partnership with AWS?

We have a really robust partnership in flight with AWS because as customers move workloads to public cloud, those customers want to have a secure and optimized experience with AWS. So we have virtual network functions and virtual security functions that can be deployed on top of AWS to secure and optimize that experience. We're partnering with AWS so that as customers think about that hybrid cloud environment: how do they architect their SD-WAN [or] how do they architect their private cloud to match up with that public cloud capability with AWS? So how do they orchestrate all of that with Cisco with things like Cisco CloudCenter.

How is the AWS partnership helping Cisco?

Networking and security are the top two categories on the AWS Marketplace and last time I checked, we are the market leader in networking and the market leader in security in the industry. So the fact that network and security are their top two categories and we're partnering together, I think that's only going to mean goodness for our joint customers.

How is AWS helping Cisco partners?

From a partner point of view, that's going to yield more and more opportunity for them because partners want to build hybrid cloud environments. This comes back to the end-to-end architecture discussion, because if you think about hybrid cloud, it's not just about data center – it's about network, it's about security. And who can bring that better to bear than Cisco from an end-to-end perspective.

Let's talk about Cisco's new IOS XE software and how it's different from your IOS of the past?

IOS is new and different and better than ever before. Reason number one is, by really making it programmable, our customers can leverage third-party applications like a Puppet to drive their own automation and scripting. So if you think about the kinds of things that customers have done to simplify the management of data center environments, for the first time ever, they can now bring that kind of focus and attention into the core network. They can certainly leverage capabilities that we're bringing to market like DNA Center, but they can also innovate themselves.

Our partners can now innovate and now drive that kind of programmability experience, and new services and software opportunity, by innovating on top of our IOS because it's open and programmable.

Why was it so important to make the new IOS modular?

A lot of time when an issue occurs – let's say a software defect – it would basically require an IOS upgrade. To go through an IOS upgrade a lot of the times the customers would have to do a lot of testing and validation before their IT operations team would feel comfortable upgrading the IOS. Because our new IOS is modular, you can basically patch [issues] without an upgrade.

So what was the old IOS model before compared to the new one?

Let's say there's something identified that requires an update. The model before was, 'We got to upgrade the whole device, the whole IOS -- that's potentially network downtime.' Now, basically we can go in surgically and say, 'This is the piece of code that requires a patch. We can now patch that particular level of code.' So it's modular and that's speaking more from a troubleshooting, issue-resolution point of view.

But because it's open and modular, if a customer has a specific use case -- and more importantly if a partner has an opportunity to drive a specific use case for a customer -- they can build and provide modular patching and modular streams out from the IOS. Those are things we never really had in IOS before.

Can a partner implement Cisco's new IOS for a customer who's already deployed DNA?

Yes. So from a simplicity point of view for our partners and customers, this IOS is backwards compatible. Yes, we've launched new hardware … [but] this IOS is backwards compatible into the existing DNA investments that our customers have made. So you can have a unified IOS across the entire core environment. That's great news for partners.

What is the fundament goal of Cisco's new Intuitive Network from a partner point of view?

We are fundamentally now making the network a business conversation. The industry is looking at the network as technology, but we're really looking at this now – because it's such an end-to-end architecture – it's fundamentally now a business discussion and conversation.

Our partners are most profitable when then concentrate on the line of business and the business opportunities. They're most profitable when they are driving more in the way of advising and consulting services. They're most profitable leading with security. This is a great example of how we're going to concentrate on business outcomes, helping our partners unlock more consulting and advising opportunities, and helping our partners drive security relevance. This addresses all of those things.

How big of a revenue driver can this be for partners on the security front?

Security is at the forefront of everything that we're doing from a network point of view. It's built-in from essentially the first byte that we're developing. It's built into our ASIC. It's built into our software. Nobody else in the industry has that kind of commitment and integration of security within the network like we do.

Because we have security built-in, it's not just about the business consulting and the business advisory. But partners can quickly transcend it into the security posture and security advisory conversations as well, which we know is extremely margin rich.

Where are the most margin-rich opportunities for partners with this new networking technology launching?

From our partners' POV, the kind of services that they can attach to the opportunity is typically the most margin-rich. We're expanding the kind of services that they can offer to their customers because they can really get much more into the business advisory and business consultative dialog. … We're also helping our partners build a recurring revenue capability because of the software licensing construct that we're bringing to bear.

Why should partners be pumped about selling Cisco's new Network Intuitive architecture?

Security is top of mind for customers [as well as] making sure that they've got the network for the future in terms of mobility, cloud and the Internet of Things. Also, how do they segment that network, how do they take costs [down] on how they're managing their network. Partners can now address all those matters with what we're coming to market with.

It's going to lead to the expansion of their services TAM (Total Addressable Market) because this is a much more architecture, end-to-end oriented conversation. And because everything is open and programmable -- for those partners choosing to go down this path, they can also start to really build their own IP and monetize their IP on top of their portfolio. That is extremely margin rich for them and leads to much more recurring revenue opportunity.