Cisco enters the server market or battles with HP

Source: Internet
Author: User
Cisco entered the server market or held a decisive battle with Hp-Linux Enterprise Application-Linux server application information. The following is a detailed description. In August 8, Cisco CEO John Chambers was facing a four-quarter decline in revenue. The company will surpass network equipment and expand its business to computer servers, it directly challenges large companies in the computer industry.

According to foreign media reports, the local time in August 5, Chambers said the current quarter revenue will decline by at least 15%. To achieve its annual revenue growth of 17%, cisco will promote the data center computer market and direct access to HP and IBM products. Chambers said in an interview on the same day: "We still have time to enter new markets such as data centers, which is a challenge. IBM will be a partner, and we will stay close to the degree of development of the Partnership. Both parties are working in progress. Obviously, HP is a competitor ."

Simon Leopold, an analyst at Morgan Keegan, said that big companies such as Google and Microsoft are reducing their data centers to cope with the economic downturn, demand for Cisco routers and switches slowed down. In response to the slowdown in sales, Cisco began selling its Unified Computing System, which integrates computer servers, storage and network devices last month ). Chambers said the company is still looking for opportunities.

Profit pool

Chambers said in an interview with the media on February 23, August 6: "We will take an initiative in the market ." Cisco had $35 billion in cash by the end of last quarter. Chambers said: "We have a huge cash competitive advantage ."

Cisco's fourth quarter financial report as of July 25 showed that profits fell from $2.01 billion in the same period last year to $1.08 billion, down by 46%; revenue fell by 18% to $8.54 billion.

"To maintain revenue growth, Cisco needs to support a larger profit pool," said Mark Demos, Investment Manager of fifty Third Asset Management. With the success in the data center, Cisco can obtain many existing customers, and the existing customers will be transferred to other fields due to Cisco's good reputation ."

Win all

Ray Lane, managing partner of venture capital firm Kleiner Perkins Caufield & Byers, said chambers followed up with HP and IBM by betting on the "win-all" rule. With the competition between the three companies, the relationship between Hewlett-Packard, IBM, and Cisco, which sell Cisco network devices, will become increasingly tense.

Leyin is the former president of Oracle and has 30 years of friendship with Chambers. He said: "I don't doubt Chambers's strategy, but this is a very risky move. Either it will succeed or it will be defeated. After direct competition, they will lose cooperation ."

"A tacit partnership"

According to data from Gartner, the market analysis agency, IBM had about 30.7% of the global computer server market in the first quarter of this year, and HP had about 28.8% of the market. Cisco was not ranked in this field. The overall server revenue last year was $53.1 billion.

Toni Sacconaghi, analyst at Sanford C. Bernstein, said HP and Cisco used to work together to supply products to customers. "They had a tacit understanding before, but now the competition is fierce," he said ."

Smart grid

IBM and Cisco are still cooperating in a non-directly competitive market, for example, they are still working in the smart grid field. Brian Halla, CEO and Cisco Director of National Semiconductor Company for chip manufacturers, said: "Cisco is more willing to maintain a harmonious partnership with these companies !"

One of Cisco's challenges is to persuade customers to buy products that integrate storage, network, and server.

Difficult attempts

To fulfill Chambers's goal, Cisco has deployed 30 new growth fields, including video products and smart grid devices. Yahoo CEO Carol Bartz said Cisco will follow up on all markets related to network and information sharing. (Source: Saidi net Author: Liu Yanqing)
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