> Experience (ironically) could have caused pause before
launching the word
> "labrat" off the sounding board here at
groupstudy, as this is a very
> hot-button topic that consistently evokes emotion on
both sides of the
> fence. I can't speculate Larry's position which might
take us further down
> a
> bad road.
While I too wish to avoid going down a bad road, I would
posit that one
possible source of consternation is the fact that extensive
experience can
actually "hurt" you in passing the CCIE lab, for
the simple reason that
there are various things that you can do, in fact, almost
have to do, to
pass the lab, that you would never be caught dead doing in a
real live
production network. The lab will often times make you
configure networks
in a way that violates good principles.
>
> I am proud to work for Cisco in various spaces -
currently on the
> receiving
> end of a Cisco acquisition. Having worked previously
for Cisco in the
> marketplace on a wireless account team as an engineer,
and now as a staff
> engineer for a complimentary product line to existing
optical gear at
> Scientific Atlanta, I have the unique perspective of
being on both sides
> of
> the Cisco acquisition mindset.
>
> Any company thinks they're the best at what they do.
"J" -uniper, Foundry,
> Extreme, Huawei, Nortel, Avaya-- take your pick at
competitors and it's
> pretty safe to say that while they may or may not have
the largest market
> share, they believe their gear is the best at the
market they play to. If
> you're not the best you strive to be, and that goes
for Cisco, Juniper,
> and
> any/all the others mentioned above.
>
> Acquisition is not meant to fix holes or bugs in
existing market share. If
> it were you'd be out of business in no time flat
because you'd be
> competing
> against yourself and wasting capex with no revenue
return from new
> markets/products. Linksys gave Cisco phenomenal
consumer presence where
> previously Joe Q. Public on the street who bought gear
for home from Best
> Buy may have heard of Cisco, but had no idea what their
products were now
> recognizes the company, the logo, and the brand.
Scientific Atlanta gives
> them a huge huge boost in the application space - not
just video or CATV,
> but other potential future markets and content.
SA, Linksys, and other acquisitions like Stratacom were
market-expanding
acquisitions. These were all companies that were well
established within
whatever niche they were in. These are straight-up M&A
deals in order to
obtain strategic market positioning.
However, there is an entire different group of acquisitions
that one can
safely call 'technology-expanding'. Let's face it. The
vast majority of
acquisitions that Cisco has made have been small startups.
Some of them had
barely shipped any product, and in a few rare cases, had yet
to book a sale
at all, before Cisco acquired the company. Clearly neither
Cisco nor
anybody else was seriously competing against such a startup.
There was no
competition to be seen. Cisco scooped these companies in
order to fill a
technology hole, pure and simple.
As a simple example, Cisco acquired Signalworks in order to
outfit AVVID
with better echo-cancellation technology, nothing more,
nothing less. It
was a basic admission that Cisco's current echo-cancellers
weren't quite
cutting it.
In fact, there is an entire cottage industry of little
network startups in
Silicon Valley and elsewhere who are deliberately trying to
set themselves
up to be acquired by Cisco or some other large network
vendor. These
companies have little serious intention of becoming a
'real' company that
can stand on its own. Instead, the company management, and
especially the
VC investors, are pushing these companies to develop a
feature that the big
vendors are seen to be lacking, such that will be scooped
up. In fact, you
could see this as a form of outsourced, VC-funded R&D.
Instead of running
your own large corporate R&D department the way that
Xerox did with PARC,
Lucent did with Bell Labs, and IBM did (and still does) with
its labs, just
have the startups do the groundfloor development and then
acquire the most
promising of those startups.
>
> Is "J" any different? Do you think they'd
have been half the threat they
> are
> without acquiring Netscreen - routers and technology
aside, Netscreen is a
> huge factor to figure in for Juniper and their market
position. On that
> same
> line, can you really compare a company like Juniper
that has it's sights
> on
> Cisco, and only competes in 2 main areas - routing and
security? They
> don't
> even make a switch, which really impacts the playing
field - do I want a 2
> vendor solution in my core, or one? Where is my demark
for a Cisco network
> and a Juniper network? Regardless of who picks and/or
wins the battle,
> Cisco
> is playing, and winning the war. Looking at the
numbers, Cisco stock is
> trading on an incline over the last month, highest
levels in a year, and
> highest since mid 2004. Juniper stock is down lately
(by comparison of the
> week, though up since a month ago, down almost $3 from
3 months ago) and
> at
> it's lowest levels since early 2004.
Come on now, that's a fairly conveniently selective choice
of timelines
don't you think? For example, I can pick and choose my
timelines to make
Juniper look like they're winning the financial war. For
example, if I
choose to look at the stock performance of both companies
over the last 6
years (by using the "max" choice on Yahoo
Finance), I see that Juniper is
beating Cisco.
http://finance.yahoo.com/q/bc?s
=JNPR&t=my&l=on&z=m&q=l&c=csco
Look, I don't think that Cisco can really be said to be
definitively
"winning" or "losing" the war. The
truth is, all network vendors, Cisco and
Juniper included, have major strategic challenges on their
hands.
> Cisco competes, and dominates or is
> 2nd, in every market it plays in
I would dispute this also. There are PLENTY of markets in
which Cisco is an
also-ran. Again, how well is the Cisco MGX WAN-switch line
doing? Last time
I checked, Cisco was barely 5th in that market in terms of
share. Granted,
that was a while ago, but I doubt that things have changed
dramatically.
How about the ONS line of optical gear, how well has that
been doing? How
about DSL equipment? Last time I checked, Cisco was an
also-ran in both DSL
CPE and regular DSLAM's, markets that are dominated by
Alcatel. Cisco has
some strength in IP DSLAM's, but in regular DSLAM's, Cisco
is only a minor
player.
Look, I'm not trying to overly harp on Cisco's problems.
I freely agree
that Cisco is the strongest networking vendor in the world.
However, let's
be honest. Not everything that Cisco touches turns to gold.
Cisco is not a
perfect company. Cisco has made some serious mistakes. I
think even most
Cisco people, even John Chambers himself, now concedes that
the Stratacom
acquisition was bad. Chambers would probably like to have
that one back. I
think they will concede that certain optical acquisitions
like Qeyton and
Pirelli were bad and that Cerent, while moderately
successful, was probably
not worth the money (a nearly $7 billion deal). Granted,
its competitors
made even worse mistakes, i.e. Nortel buying Qtera and
Lucent acquiring
Chromatis were true first-degree disasters, but the point
is, Cisco
certainly does not have an unblemished record, and we should
not pretend
that it does.
>- with the attention of the Sci Atl
> acquisition, Larry Chambers has been in the media eye
more that usual and
> the vision of Cisco in its short ~22yrs is
unparalleled.
>
> I'll get off my soap box now, but over the last few
years on this list
> I've
> seen many negative views on Cisco and wanted to present
a positive one
> from
> one on the "inside". I do believe that
Cisco can improve, and will. I also
> believe that other companies are very good at what they
do in some areas,
> and are a very real threat, or even leader *in specific
technical
> areas/environments. But I don't believe that Cisco is
weak for growing by
> acquisition, or wrong for doing so, and obviously their
key customers
> (today
> and tomorrow) don't disagree with me as they
themselves go through similar
> transitions.
Nobody is saying that Cisco is weak for growing via
acquisition or that it
is wrong to do so. In fact, M&A, properly executed, is
a perfectly
legitimate business strategy.
What I am saying is that Cisco is not a perfect company with
perfect
products. And in particular, what Cisco says in its
marketing is not always
(and in fact, not usually) what Cisco employees privately
believe. This is
true of any company. No company actually states in its
marketing what its
employees truly think. Just because Cisco masterfully
markets its products
as the greatest things since sliced bread does not mean that
all of its
employees privately believe this to be true.
Message Posted at:
http://www.groupstudy.com/form/read.php?f=7
&i=108138&t=108076
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