Cisco to ride network to the cloud

If Howard Charney, senior vice-president, Cisco Systems Inc, is to be believed, it should be a cakewalk to take on IBM and Hewlett-Packard in the cloud, given that it is more network-centric than the rival giants, which are server-centric. He should know.

Charney’s company, Grand Junction Networks, which was acquired by Cisco, had invented the Fast Ethernet and low-cost switching.

The senior advisor to Cisco honcho John Chambers, was also the co-founder of 3Com whose breakthrough technologies brought the Internet to the desktop. The comments gain significance in the backdrop of the announcement of the formation of Acadia, a three-way collaboration between Cisco, EMS and VMware on Tuesday for the virtual computing environment (VCE), that will develop integrated cloud computing products called Vblock Infrastrucutre Packages including servers, networking, storage and virtualisation software for data centres.

The JV is targeted at a potential opportunity, which according to McKinsey & Co. is upwards of $350 billion annually, half of which goes on capital expenses and the rest on operating expenses.

Speaking to DNA Money, Charney said servers are commodity items and the network is now the factory where customers’ strategic decision are being made.

And given the fact that Cisco’s architecture is network-centric ab initio, it will be much easier to take on companies like IBM and HP which have been in the data centre and cloud business much earlier.

 “We believe the future is in the network where the data flow as opposed to compute-flow is the critical path with switching, which is Cisco’s core competence, playing a crucial role,” Charney said in an exclusive chat on the sidelines of a Business Technology Summit at the Indian Institute of Science (IISc) here.

In fact a similar question as to how we will compete with the existing giants was asked when we entered the telephony business, Charney recollected. Why and how would you go and compete with the likes of Alcatel, Ericson, Nortel?

The answer was simple, the network was becoming IP-centric and the IP network is taking over and subsuming the telephony network. The data centre is just like that and the same is happening where compute is concerned, he added.

The switching and networking giant had shocked the tech-world a few months back when it announced it was getting into the data centre and would start selling storage and virtualisation stacks with its Unified Computing Solutions (UCS).

While, the UCS offerings are being test marketed in the North American markets they are slated to be launched in India in December, Charney said.