Cisco Getting its Act Together, but Competition is Catching Up
Cisco is putting a lot of effort into regaining the momentum and growth it has lost throughout the past 12 months. The company is now shifting its focus back to its core businesses, with the most recent example being a new datacenter fabric launch. The company today announced the Cisco High-Performance Trading Fabric designed especially for the financial sector.
“The high-performance trading fabric is based on Cisco’s holistic data center fabric approach that includes the recently announced Cisco Nexus 3064 and Nexus 5500 data center switches designed to sustain peaks of traffic without loss, while also delivering industry leading ultra-low latency performance.”
In a press release the company said that based on tests it has commissioned, the offering provides low latency, scalability sufficient for massive financial activity shifts and some advanced security features.
Cisco is currently the largest networking vendor by market share in the world, and predicts it won’t be running out of customers any time soon. In a report released by the company, it expects the number of connected devices to reach 15 billion by 2015. Cisco also forecasts that internet traffic will reach almost one zettabyte or one trillion gigabytes by 2015, which it attributed to fastening internet speeds and online video, among other things.
Over in the teleconferencing space, Cisco is starting to face some serious alternatives from competitors. Its telepresence business has been growing at a rate of about 25 percent per year and is expected to hit $4 billion in 2011, however the price tag that comes along with it may just turn out to be a major challenge. It costs about $300,000 to set-up a Telepresence deployment, while competitors such as Vidyo offer alternatives for 10 times less.
Looking at the big picture, it seems investors are not at all confident in Cisco’s strategy. The company hit a new 52-week low today at $14.97, compared to its previous 52-week high of $26. Cisco has passed Dell as the third largest blade server vendor and is expanding oversees, though the company will probably have to take more aggressive measures to gain back investors’ trust.
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