New F5 Networks CEO: 'You'd Be Foolish' Not To Integrate With Cisco

New Leader, New Focus

F5 Networks' new CEO Manny Rivelo tells CRN about his plans to reorganize the structure of the company to better empower the organization to improve its innovation and execution. Seattle-based F5 recently reported revenue jumped 10 percent to $483 million year over year for its third-quarter fiscal year 2015, with a 15 percent increase in service revenue.

Rivelo, who replaced F5's longtime leader John McAdam in July, has aspirations to grow the company "much larger" than its nearly $2 billion annual revenue mark through new initiatives on the application, security and services front.

Rivelo also talks to CRN about the leadership differences between himself and McAdams and his view of Cisco after working 19 years at the company, saying, "You'd be foolish not to want to integrate with Cisco."

How are you changing F5?

We're approaching the $2 billion mark here with aspirations to grow much larger than that. We have to continue to grow the culture inside the company, empower the organization more and increase the accountability. It can't be done by a subset of executives anymore -- we have to begin to push some of that through the organization.

Part of what I'll be doing is changing the organizational structures a little bit, as well as the empowerment that’s required to drive greater cadence of innovation and a greater cadence of execution through the company. John would have probably done that if he would have stayed here.

What are the leadership differences between you and John?

I tend to be more technically oriented than John (pictured) was. Part of that is maybe because I haven't been in the seat as long as John was and maybe some of that gets lost over time, but I understand the market and the technology. I'll be a lot more hands-on is what you'll see from a technology perspective -- helping us drive our strategy. I'm going to be taking more of an active role in that as we shape that forward.

As you steer the company into the future, what will F5 look like in a few years?

At the core we're not changing our fundamental principle of what we started out to do over a decade ago, which was to really focus around the applications and the delivery of applications. But today it requires a lot more. It requires us to secure those applications, as well as increase the performance of those applications and how they're delivered across mobile devices and across 4G, 3G networks.

The concept of hybrid networking, a hybrid-application delivery is something very relevant to the market. Our view is to continue to enhance our service portfolio, create a series of proxies that create a better user application experience no matter where that application resides or where the user tries to access the application from. We'll continue to build our portfolio around that.

You worked at Cisco for 19 years. In what ways do the two companies differ?

The major difference is our focus on applications. We sit a little higher in the OSI stack; we sit a lot closer to the applications, and the conversation is very application-centric versus when I was at Cisco the conversation we tended to have was network connectivity. The nice part of where we sit inside the OSI stack is we can have conversations with both the applications teams and the network team, so our job is to bridge those together as best as possible to create the best experience.

There's also a lot of similarities. That's why I think it was an easy transition into F5 for me. I can leverage some of those leanings over my 19 years at Cisco to apply to F5 to try to continue to propel F5 to the next level.

Do you see Cisco as a 'locked-in' vendor?

When I was at Cisco I never looked at it as a company that tried to lock people in. [Former CEO John] Chambers drove a culture being No.1 or No.2 in the markets they competed in, and, as a result, they had a large presence in those markets, whether it be security, switching, routing or wireless. Yes, the business units looked to work together to expose more value, which is sometimes easier to bring through a protocol that they developed. So Cisco had a culture of innovate quickly, get it to market quickly, then try to bring it through open standards. That sometimes might have gotten confused as it being proprietary, but that was never the intent. The intent was just about exposing value at a quicker pace.

As a company who has a partnership with Cisco, do you see Cisco adapting well to an open-standards world?

Cisco understands it's a software world. [CEO] Chuck Robbins (pictured) is taking them down that path. They're moving quickly to new licensing models, openness and things of that nature. I think that's a natural shift for Cisco, which I think they'll easily do. They're bringing their pieces of the technology stack to the table and have those well-integrated. I mean they're a key component -- you'd be foolish not to want to integrate with Cisco.

Do you see vendors, even competing vendors, partnering with each other more than ever before?

Yes, we're seeing that. In the old days, customers bought a lot of equipment -- they stacked and racked it themselves. It took them months, and they configured their networks and data center and brought up their applications. Today, everybody wants the easy button. They want to be able to deliver their services by pressing a button. That requires the partnerships that weren't there before because the market is expecting a series of vendors to come together through a set of open standards and not locked-in proprietary technology to offer those services, and that’s forcing the levels of partnerships we're now seeing out there.

Customers want integration, but they want to be able to piecemeal that integration and change vendors and companies if they're not meeting their needs.

Where is F5 making strategic partnerships?

We're partnering on many fronts. When we look at our strategy of why we have to partner with the cloud providers, why we partner with all the major SDN providers, why we partner with all the major service providers, it's because we want to be part of those integrative solutions.

Then if our technology is the best piece of that whole value proposition of the total solution, we will get chosen from that. But it's not going to be just about being the best technology -- you need to drive the total cost of ownership down and agility up.

What does the F5 software division look like compared to its hardware division?

We're predominately a software company. If you look at the innovation and engineering of our R&D team, 90 percent of it is really all about building software. We have a small team of individuals that build hardware, and that’s so we can instantiate our software and run it. What drives our margins is really the richness of our software, and that will be the same moving forward.

What is F5 doing to capitalize on the hot security market?

There's a couple of footprints we're very interested in. We're trying to leverage our proxy technology. What we want is a set of services on the user side that secure the user perimeter.

We're also going after the other side of the proxy -- the side that services the applications. There, we don’t only want to make applications highly available, but we want to make sure the application is fully defended -- everything from a DDoS vulnerability, all the way to the firewall rules sets, all the way to the signatures to protect an Apache server, for example. You're also seeing us making a lot of progress in our SSL technology.

Are you interested in firewalls?

We're not that interested in providing next-generation firewall technology today. That's not an area we have built out. We have our cloud-based SaaS services that come out of our Silverline platform -- things like anti-DDoS -- where we can offer those as subscription models to customers in case they don’t want to run them themselves. We'll continue to build out that portfolio.

How will you drive partner profitability?

We're better defining the businesses that we need our channel to move forward with. So security being an example, we'll be retooling our security partnerships around the solutions we offer -- same thing for the cloud.

What we're going to have to do is continue to do channel development, channel incentives around those technology areas, so that our value proposition is clear in the market and that partners themselves are creating demand versus us creating a demand, then partners coming in as part of the transition. As we move forward, it's really enabling our channel around our new businesses we move forward, and together we will prosper in the coming years.