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ck 12/4/2012 | 8:27:04 PM
re: What Cisco Stepped In Does Cisco have an installed base of their 64 OC 192 ONS 15800 system? Who?
Steve Saunders 12/4/2012 | 8:27:01 PM
re: What Cisco Stepped In someone sent me this via email today. I thought it was an interesting commentary. -- Steve

"Good article. For you ex-Red Herring guys who understand the numbers,
however, there is a deeper story that few people recognize. Cisco cannot
return to their previous hights just by picking up where they left off as
the economy improves. They are in the midst of a fundamental shift of
their business mix from Routers to a much higher mix of Transmission/Optical
equipment. Margins in the router business, because most of their value is
in software, ran in the 70%+ range for Cisco. Traditional margins in the
carrier market run from 45%-55% for pure transmission equipment to 60%+/-
for switching equipment.
(I hears Ciena's Coredirector is running higher now because nobody else has
their STS grooming working yet). Because the Cisco 15454 is now an aging
product (4 years old) with more competition, I hear that its margins range
anywhere from low 30s to high 40s depending on the deal.

So, this means that as Cisco gains share in optical transmission and looses
router share to Juniper, their overall margins will drop even as overall
revenue increases. This also means that the Monterey failure was not just
Cisco missing a market niche or wasting money, but missing a chance at
improving margins in their optical business. They now have nothing in the
core optical switching space and nothing at the edge either. As a result,
their optical portfolio is concentrated in the low margin area (pure
transmission and pure DWDM) of the optical space.

Bottom line: Cisco can't afford to just trade router revenue for optical
revenue. They have got to try to skew their mix back towards Routers by
increasing the ratio between routers and optical. That's the source of this
whole IP+Optical marketing blitz. Figure out a way to sell a router with
every piece of optical gear so you don't loose your shirt. (The guys at
Cogent told me that Cisco sales reps keep trying to re-engineer their
network to put in more routers where they don't need them)

Cisco could also attempt to buy their way back into the OXC business or edge
DCS/switch business, but these are (relatively) high value companies and I
don't see Cisco having the self confidence to make this kind of bet any time
JoePerches 12/4/2012 | 8:27:01 PM
re: What Cisco Stepped In To Skeptic:

I am interested in your opinion about requirements for generating and tracking IP flows.

I would appreciate the opportunity to discuss this topic with you in a forum of your choice.

Joe Perches
Spirent Communications
mailto:[email protected]
w: 818 676 2375



Is there any test equipment capable of generating streams of traffic with unique IP src/dest, port, protocol type (ie, discrete flows), and look for reordering on a per-flow basis? That would certainly put the argument to rest.
brichter 12/4/2012 | 8:27:00 PM
re: What Cisco Stepped In " So, if that doesn't happen, what will Cisco be in 5-10 years?"

So if the sky falls, what will we all be in 5-10 years?
Any company that can't change, will die.
Substitute any other company's name for Cisco, and ask the same question.
BTW, Cisco has been faster at adapting than a lot of others mentioned in this same post. As far as getting caught with inventory, you have to bring as# to get as#. A scared man can't win.
Love it when you guys try to cap on Cisco, just because they don't advertise here.
gladysnight 12/4/2012 | 8:27:00 PM
re: What Cisco Stepped In "What happened to Pirelli/Cisco?"

Well, it seems that the core transport people are not Cisco's most ardent believers, so the buying of Pirelli just ruined any good progress Pirelli had made on their own.

There may be some core transport folk out there who believe Cisco's marketing but I've yet to meet any.

Anyone else know of any?
brichter 12/4/2012 | 8:26:59 PM
re: What Cisco Stepped In This is because Cisco doesn't advertise here.
Belzebutt 12/4/2012 | 8:26:57 PM
re: What Cisco Stepped In "So, this means that as Cisco gains share in optical transmission and looses
router share to Juniper, their overall margins will drop even as overall
revenue increases."

There's one problem though. For this latest quarter their product mix actually shows the router share increasing, according to what I read. So they're loosing to Juniper but they're relying more on routers, i.e. they're getting eaten from both ends. I guess the message you posted talks more about long-term, but who knows...
cable_guy 12/4/2012 | 8:26:55 PM
re: What Cisco Stepped In >Does Cisco have an installed base of their 64 OC >192 ONS 15800 system? Who?

Global Crossing
Cambrian Communications
XO Communications
Cablecom (Switzerland)
Infostrada (Italy)
Deutsche Telekom (Germany)
France Telecom

to name a few
BraggGrate 12/4/2012 | 8:26:52 PM
re: What Cisco Stepped In Yes, Global Crossing has deployed Pirelli/Cisco's OC-192 Wavemux system in NA. I'm not sure about EMEA.
DCITDave 12/4/2012 | 8:26:51 PM
re: What Cisco Stepped In Really? That's news to me. What proof do you have of that? When exactly did you come to witness any of our coverage being assigned on the basis of who buys ads and who doesn't?

I'm always interested in how someone who's probably never met the LR staff thinks they know exactly what our motivation is for writing news.

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