In a six-page Fast Company article about Cisco this week, Cisco CEO John Chambers is quoted as stating:
| "In Russia, our leasing portfolio is more than $700 million, with one small write-down for only $200,000." |
Chambers' quote above really caught my attention because according to its Form 10-K filed with the SEC on Sep. 15, 2008, Cisco's $700 million leasing portfolio (the finance definition of portfolio is a collection of investments held by an institution) in Russia would represent more than 49% of Cisco lease receivables, net.
See related story: Welcome to the - Bank of Cisco
Note: Verified with Cisco the accuracy of Chambers' $700 million leasing portfolio quote in the Fast Company article above and received the following official response from Cisco:
| "Brad, there is some misinterpretation in the Fast Co article.
"The $700 million referenced is the amount of total product sales that were facilitated by all Cisco and third party financing activity in Russia in the last full fiscal year. "The actual lease commitments are a much smaller number, which we do not disclose separately as they are not material. "The $700M represents all the revenue that the financing function enabled in Russia in FY08, including customer financing and short-term channel partner financing." |
It appears Cisco may have entered the systems integration business with the announcement last week that Cisco Services Malaysia Sdn Bhd entered into a strategic collaboration with YTL e-Solutions Berhad.
According to Cisco, the purpose of the collaboration is to build and integrate YTLE's WiMAX core network - which includes IP CORE, Operating Support Systems, Billing Systems, Proactive Network Operating Center (PNOC) and Interoperability Testing labs.
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Brad Cooper - CCIE #13747 Voice, a Canadian citizen and 8-year Cisco employee working as a VoIP Architect at Cisco's Research Triangle Park, N.C. campus under an H-1B Visa, has been arrested and charged with the first-degree murder of his wife - Nancy Cooper, also a Canadian citizen.
If convicted of first-degree murder, Cooper faces either the death penalty or a life in prison sentence without the possibility of parole. As CCIE #13747 Voice, Cooper earned more than $100,000 last year and has been on paid leave.
Cooper is being held in jail without bond (view the order for Cooper's arrest). He remains a Cisco employee.
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This week Cisco released the November 2008 net new worldwide CCIE count. According to Dual CCIE #18532 Security/Routing and Switching - George Morton, Ph. D:
 "The torrent pace of new CCIEs is back on track after the doldrums of summer. The net new count of CCIEs from October 10th 2008 to November 24th 2008 grew by 367 or 8.155 new CCIEs per day.
"The big news for the November count was that China accounted for 30% of all net new growth in CCIEs for the world. Even India this time around beat the USA in minting new CCIEs. "The second bit of news was that the Middle East beat out North America when counting new CCIEs by region. "No single month can tell an entire story, but what has become clear to me is that the USA is no longer the CCIE manufacturing engine that it once was. Perhaps this raises a question about the value of becoming a new CCIE in America, especially since fewer Americans are passing. "Is the CCIE losing its luster in the USA? "Could a salary survey confirming the lack of importance of CCIEs in the USA be not too far away in the future?" |
Enterprise fixed-mobile convergence platform vendor and Cisco technology partner - Agito Networks - Monday announced the appointment of Amit Chawla as its new CEO. On Dec. 2 yours truly will be recording a podcast interview with Mr. Chawla for Network World's Cisco News and Reviews podcast series. In preparation for this interview, yours truly cordially invites you to submit questions you would like to ask Mr. Chawla (submit your questions here).
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A story in Light Reading today confirmed that the new Cisco ASR 9000 is using an off-the-shelf packet-processing chip, a chip that is a member of the Cisco silicon brand labeled QuantumFlow.
Light Reading states that a Cisco spokeswoman confirmed that the ASR 9000 supports a member of the QuantumFlow family of forwarding engines.
Other Light Reading sources said the "QuantumFlow" in question is the NP-3c, a Cisco-specific variation of the EZchip's NP-3 device ("So, they can sort of, with a straight face, call it a custom processor," say the Light Reading sources).
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In the video below shot earlier today, Mike Klayko - Brocade CEO discusses why some will fail and others will succeed in the current difficult economic environment. At the 2:50 time mark, Mike succinctly sums up Brocade's future:
Everywhere Cisco is now, Brocade will be there!
Additionally, Tom Buiocchi - Brocade Vice President of Worldwide Marketing, took the time today to phone yours truly in order to answer a few questions:
 Q: How have the new Cisco Nexus 5000 and 7000 products affected Brocade?
"Honestly, we do not see much of them in the market today. "The Nexus line is really not competitive with Brocade directors in the market today, as it’s not shipping in production quality or quantity, and initially supports only classic Ethernet, making it a more direct competitor with some of Juniper’s products and a replacement for the Catalyst switch line from Cisco. We think we may see it supporting both FC and FCoE sometime in 2009 to 2010. "Also, we do not think it will be sold by storage vendors, so it is highly doubtful that it will be connecting to enterprise storage. Cisco’s MDS product line fills this spot in its portfolio and Brocade clearly has advantages there." |
All this month Cisco has been touting the upcoming launch of its new ASR 9000 Carrier Ethernet router.
However suprisingly, for calendar year 3Q08, Cisco suffered an unusual loss of market share in service provider routers.
According to Shin Umeda - the Dell’Oro Group router analyst, "Our Service Provider Router Market report showed a significant slowdown in sales for the third quarter. Cisco continued to be the top ranked vendor, but the company’s revenue declined 10% sequentially, and their market share dropped from 57% to 51%. The next four vendors in the rankings, Juniper, Alcatel-Lucent, Huawei, and Redback each gained share."
Umeda added, "We attribute Cisco’s share loss to a combination of revenue recognition timing and the completion of a major network build-out by a large customer. With regard to revenue recognition, we believe Cisco recognized an extraordinarily large amount of revenue in the month of June and a correspondingly lower amount in the month of July. Since Cisco’s fiscal quarter ended in July, the imbalance between June and July had little net effect on their reported financial results. However, because market shares are based on calendar quarters, the strong June results lifted 2Q08 sales, while the weaker July results depressed 3Q08 sales."
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Cisco Technology Developer Partner - Arbor Networks, a provider of flow-based and deep packet inspection (DPI) technologies to ISPs, released a survey of 66 ISPs last week that says from relatively humble megabit beginnings in 2000, the largest DDoS attacks have now grown a hundredfold to break the 40 gigabit barrier this year. The growth in attack size according to Arbor, continues to significantly outpace the corresponding increase in underlying transmission speed and ISP infrastructure investment.
Also according to the Arbor survey, trends suggest that DDoS attack sizes may be on pace to approach 100 gigabits by this time next year, or perhaps more sophisticated attack vectors will be employed and bits per second won’t be as significant.
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Earlier this week Brocade pre-announced standout fiscal 4th quarter results (view video), in which revenues will be anywhere between $15-$21 million more than what was previously projected in the August 2008 Brocade fiscal third quarter conference call.
Additionally in a research note to yours truly, RBC Capital Markets analyst Thomas Curlin stated, "We believe Brocade's 8Gbps Fibre Channel product cycle acted as the key catalyst for the performance."
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 In his research note to yours truly this morning, RBC Capital Markets Mananging Director - Mark Sue appears to have forebodingly written the last rites for Nortel by lowering his price target for Nortel stock from $1.50 per share to $0 (i.e. zero, nil, zilch), warning that common equity holders are last in line during a bankruptcy which he considers a distinct possibility for Nortel. Read more Nortel's future has been called into question a lot this week, but why go so far as to issue a price forecast of $0 for Nortel common stock? |
At approximately the 3:04 time mark into the Internetwork Expert (IE) Cisco 360 Program live webcast last month, IE's Brian Dennis CCIE #2210, made the following statement:
"As a CLP (i.e. Cisco Learning Partner) we could not sell or market outside of North America."
In regard to the above statement made by Brian Dennis of IE, the General Manager of Learning@Cisco - Jeanne Beliveau-Dunn, provided the following official Cisco response:
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Today in his final blog post, Nortel chief technology officer John Roese blogged:
| "Well, it's been an interesting 28 months here at Nortel for me. The company has announced today that it is moving to a business unit structure in which all functions and resources (other than a few corporate activities) will be decentralized and integrated into full business units. Read more "With that change, the central CTO and R&D functions will be divided and moved into each BU and, as such, my role is no longer needed." |
It's illuminating to examine various Cisco product group sales over the past 9 years and chart their evolution as a percentage of Cisco yearly net sales. Advanced Technologies stands out as one group that has increased its contribution to Cisco sales since the company began recording sales from the group in 2003. It "vanquished" Routers in 2007 by grabbing a higher percentage of Cisco's net sales (23.1% for Advanced Technologies vs. 19.8% for Routers).
Perhaps at the current rate Switching could be "trumped" by Advanced Technologies as early as next year?
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In his research note to yours truly today, RBC Capital Markets Managing Director - Mark Sue trimmed over $3 billion in sales from his CY09 Cisco revenue forecast.
 According to Sue, "Cisco saw order growth decrease from +7% in August to -9% in October and is endorsing revenues to contract -5% to -10% for the January quarter. Read more "Book to Bill was less than 1.0 and with limited visibility. We've already cut numbers but it seems we didn't cut them enough and for CY09, we're now estimating a YoY decline of -8% to $36.5B down from +5%." |
It now appears that Cisco CEO John Chambers has missed the opportunity to become Treasury Secretary in a John McCain administration, nevertheless, Chambers can take solace in his current "gig" as Treasury Czar to Cisco networking partners and customers the world over.
Welcome to the - Bank of Cisco
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Yours truly is puzzled by the appointment of former Cisco executive and current JDS Uniphase CEO - Kevin Kennedy, as the new CEO of Avaya.
It's puzzling when you take into consideration that during Kennedy's 5 years at the helm of JDS Uniphase its annual operating losses were never less than $119M per year (which averages out to $326K in operating losses for every single day of the year).
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Cisco loves to pontificate about collaboration, however, could it all just be bunk?
Last week Network World readers learned that a former Cisco reseller was awarded more than $6 million in damages in a cross-lawsuit trial against Cisco. Perhaps most telling of Cisco's collaboration prowess, Judge Gregory H. Lewis of the California Superior Court ruled that certain provisions of the Cisco reseller agreement were "unconscionable."
Also last week, we learned that Cisco's launch of its 360 training program for CCIEs divided the market into Cisco-authorized training and independents (i.e. grey market/unauthorized training providers).
For fiscal 2008, Cisco averaged $458K in net income per CCIE.
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Have you ever enjoyed a Reese's Peanut Butter Cup?
One year warranty on refurbished:
One year warranty Cisco Repair
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Cisco vs. Competitor Lab Tests |
Internetwork Expert co-founders Brian Dennis and Brian McGahan are preparing to make a "major corporate announcement" in a live Webcast scheduled for tomorrow at 11 a.m. (PDT).
I know I'm putting myself out on a limb here, but I believe the announcement is going to be that Cisco is buying IE and here's why:
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About Brad Reese on Cisco
Brad Reese cofounded BradReese.Com Cisco Refurbished which offers one year warranties on Cisco Refurbished and Cisco Repair.
Contact him.
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The opinions expressed in this Weblog are those of the writer and may not represent the opinions of Network World.
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