Mar
06
2009




Cisco to enter the Virtualization Server Market

Is this Cisco's future?

I just read on CNN.com that Cisco has announced a server line of products.  I find this interesting because the main reason I don’t use Cisco products is their high cost.  They make some of the best switches and routers, but do they have the mentality to be competitive in the mainstream server market?
One of the huge selling points of virtualization technology is the ability to cut power and hardware cost.  Knowing Cisco their baseline server product will probably be blade server costing $10,000 or more(+ whatever VMware’s cut is).

here is a quote from the CNN article:

“Chambers says virtualization is one of his big priorities for 2009, along with globalization, video growth, customer relationships, and Web 2.0. With its strong position among corporate information technology departments – Cisco has 61% of the router market – the company surely will be able to get an audience for its servers. But if he aims to beat HP, Dell, and IBM on their home court, Chambers is going to have to serve up something truly groundbreaking.”

You can read the whole article here.

The New York Times also ran an article that brought up some excellent points.

“The product — a server computer equipped with sophisticated virtualization software — is a bold but risky move by Cisco into an unfamiliar, intensely competitive market that typically produces far lower profits than Cisco makes from network gear”

You can read the whole article here.

I seriously doubt Cisco is ready to compete against HP, IBM, Microsoft and the Open Source Community.  Virtualization has taken years to become a reality.  Cisco will rely on a VMware product that buyers can already find on cheaper x86 hardware.  By contrast the VoIP market is ripe for the picking, escpicially if Cisco prices more aggressivly against open source Asterisk.  Gianormous Corporations never learn…

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