Cisco strategy and direction.
Anyone who has been following Cisco products recently (last year or so), must have noticed Cisco’s new products.
This includes the Flip video recorder as well as the new tablet that has just been announced.
On top of that, adding the Linksys brand to their portfolio a couple of years ago, proves they are going in a completely different direction than previously.
Cisco has always been viewed as a top notch brand by their customers. I know this for a fact, as ive been in the networking department of a large
company for quite some time before jumping the fence becoming a consultant.
When we looked into networking products at my previous job, we always had Cisco in mind as the default choice, because of the reputation as being the number one player in
switching, routing and arguably security. When looking at the alternatives, such as Juniper and other players in the marketplace, we always measured it against the
Cisco alternative.
The reason why Cisco became number one, is the fact that they were operating in a specific market — namely moving frames and packets around the network and doing it for
years on end.
Businesses are looking for products that are reputable for being business specific. Going into the home market with the Linksys brand has confused quite alot of
customers. I know this for sure, as some smaller customers are asking for the difference between buying a Linksys router compared to buying a Cisco router such as the 1800 series.
We, as consultants, have a hard time explaining to customers about ASIC architecture, software configuration, IOS feature set and so forth. Why should they care? They just want
a router or a switch after all.
Okay, so if the reputation is diminishing, how about the price? Well, Cisco is still keeping a pretty high price tag on their products, others vendors are not. Take a look at a competing switch from HP. Its only 50-75% the price of the “same” Cisco product.
So the current situation, as i see it, is that Cisco is loosing its edge in the reputation game, which is a huge deal, leaving room for other players such as HP and Juniper to be considered.
When you dont have the reputation to rely upon, next up is the price. As stated above, other players are winning in this area as well.
So what to do?
Im not sure to be honest. Its becoming a very competitive marketplace for Cisco. So why are they doing it? – Shareholders. More wants more.
Even though Cisco has been making a ton of money, its never enough. If you cant expand in the current market, you need to go elsewhere. This elsewhere is Linksys, Flip and now tablets.
My prediction is, that whatever money they make in these new markets, they will loose in the traditional routing and switching market – ie. making it a bad choice in my opinion.
Where does this leave resellers of Cisco products?
In a position where we are loosing money and selling less Cisco equipment.
I will always suggest Cisco products. I am a Cisco consultant after all. My point is that i need some tools/arguments from Cisco, that i can present to potential customers and “make” them choose Cisco instead of other products.
Either that, or give up on those look-a-like products, and re-establish their reputation in the marketplace.
I would like the latter option.
Cisco – Rethink your strategy!