Sources: Cisco Rejects Optical Bids
One Silicon Valley source went further, saying Cisco thought the offers were too low. Cisco says it doesn't comment on rumors and speculation.
Layoffs, restructuring, and shuffled execs have led many to believe optical networking is becoming a second-class citizen at Cisco. Some believe the company isn't heavily promoting its DWDM boxes and multiservice provisioning platforms, instead focusing its optical energy on IP-over-DWDM. (See Optical: Cisco's Odd Man Out?)
Among the most telling signs, observers say, is the removal of optical from Cisco's "Advanced Technologies," which represent potential $1 billion annual revenue opportunities (wireless, security, and home networking, for example). Cisco also stopped spelling out its optical revenues, beginning in its first quarter of 2007, which ended in October.
Executives did give one hint for that quarter, though, saying optical revenues grew in the mid-20 percent range. (See Cisco Soars in Q1.)
Analyst Joe Chiasson of Susquehanna Financial Group figures the ONS 15454 -- the flagship box acquired with Cerent Corp. in 1999 -- is the only real moneymaker in Cisco's optical arsenal. But that money isn't trivial, meaning Cisco probably isn't desperate to part with the box.
"It wouldn't surprise me, if somebody lowballed this, if they said, 'Take a walk,' " Chiasson says.
Prior to talk of the bids, optical networking didn't figure to be a big topic at Cisco's annual analyst conference, which starts tomorrow in downtown San Jose. And it still may not be, as CEO John Chambers lately has been more excited to talk about IPTV, developments with Scientific Atlanta , and the new TelePresence line of videoconferencing gear. (See Cisco Dials Up Videoconferencing.)
— Craig Matsumoto, Senior Editor, Light Reading