Cisco's CEO: We Shouldn't Take Advantage of Huawei
SAN DIEGO -- Cisco CEO Chuck Robbins has one message for his sales team when it comes to US-China relations and the ongoing tumult around Huawei: "This is not a sales strategy for you."
Meaning, Cisco's sales team shouldn't try to steal business from Huawei -- Cisco's top rival -- solely because the company has been banned from the US market due to security concerns amid a wider trade war between the US and China.
Further, Robbins said that Cisco has not yet seen any "material" effects from the ongoing issues surrounding China's Huawei, and he said that he doesn't believe the ongoing US-China trade war will ultimately impact the overall development of 5G technology around the globe.
"I haven't seen any slowdown," he said in response to a question on whether US-China trade policies will affect the global 5G industry. "I think that there's a huge misconception that this US-China trade war could have that effect."
Robbins made his comments during a press event here at his company's annual corporate trade show, Cisco Live. The event drew roughly 28,000 attendees -- ranging from Cisco partners to customers to suppliers -- to soak up the latest details about the company's product lines and strategy. And in between announcements stretching from AI-powered network analytics to new training programs, Cisco's executives carefully outlined how Cisco might move forwarding in an increasingly taut geopolitical business environment.
Importantly, Robbins said that he did not attend a recent meeting reported by the New York Times between Chinese officials and US companies, where the officials warned the US companies against participating in a Trump ban prohibiting sales to Chinese companies. Robbins said he had read the article about the meeting but didn't know anything more about it.
But during a flashy keynote address to thousands of Cisco Live attendees, Robbins acknowledged that the company -- along with the rest of the tech industry -- will likely face increasing oversight from regulators and other government authorities. "We have to think about those things," he said.
Robbins explained that technology in general is now "at the heart of everything" and therefore will likely fall under increasing regulation from government entities, just like other critical sectors such as healthcare have. Robbins suggested that development carries with it both challenges and opportunities.
"The point here is how critical technology has become to the world in general," he said.
Nonetheless, Cisco is reacting to the ongoing tensions between the US and China; company officials confirmed on Cisco's recent quarterly conference call with analysts that the company has been working to move more of its manufacturing out of China in order to avoid tariffs.
Of course, Cisco is perhaps the most prominent US-based vendor of telecom networking equipment, employing around 70,000 people across the world. As a result, Cisco must wend its way through an increasingly heated market for telecom equipment under the shadow of a Trump administration that has presented an increasingly aggressive posture in the area of 5G and network security. Whether that situation will ultimately aid Cisco or hinder it remains to be seen.
Cisco's revenues from China declined 21% in its most recent quarter.