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January 25, 2007

Cisco General Counsel on State of Technology in the Law

The legal industry sometimes seems not to be at the forefront of industries being transformed by technology. Mark Chandler is our SVP and General Counsel and today in San Diego, CA he gave a luncheon speech at the Northwestern School of Law's 34th Annual Securities Regulation Institute. The conference brings together national leaders in securities law, accounting and government. The keynote address was from SEC Chairman Chris Cox.

All of us at Cisco are tasked with using technology to make us more productive and more efficient and the legal group is no different. Among his chief legal officer duties, Chandler is tasked with utilizing technology to streamline legal processes and embed technology into the legal systems and processes that he implements. Clearly, there are legal hurdles as well as technological ones with this approach. In his speech today, Chandler talked about some of the challenges and opportunities utilizing technology in the law . He notes that the legal industry sometimes seems to be "the last vestige of the medieval guild system to survive into the 21st century" and ends his speech saying to the nearly 500 at the conference, "The opportunity is there to recognize the business realities that will be driven by new technology. We can seize the chance to offer more value to clients. We can seize the opportunity for our own employees to be more engaged and productive."

So, here is Mark Chandler's speech on the "State of Technology in the Law." The Wall Street Journal's Law Blog calls it, "a speech worth reading." I hope you enjoy it.

__________________________________________________________

Today I hope to offer some thoughts on the effect that changes in technology will have on the practice of law.

I offer you three questions for our discussion today.
First, how is technology driving change in knowledge-based industries?
Second, what are the key areas of vulnerability in the legal services business to these technological changes?
And third, what will it take to succeed in this changed environment?

Now as you can imagine, I have my own ideas on these questions. I don’t pretend to be unbiased. Where you sit does affect where you stand. You may profoundly disagree with my conclusions about these three questions. But they are questions that need to be grappled with by anyone who is in the business of providing legal services.

Once again, How is technology driving change in knowledge-based industries? What are the key areas of vulnerability in the legal services business to these technological changes? And finally, what will it take to succeed in this changed environment?

Let me tell you a bit about my company and why these questions are so interesting to me. Cisco sells products which connect people, from home networking products, like the iPhone, to the core routing and switching systems used by the world’s largest telecom companies. We do so at an annual run rate of $32.8B, which would place us at about number 60 in the 2006 Fortune 500. Our operating expenses are about 35% of revenue and falling. We bring about a quarter of our revenue to the bottom line, before interest and taxes. Nothing that would make a large law firm envious, but we’re proud of it. We have $19.5B in cash, generate over $2B of cash flow from operations each quarter, and have bought back $37B of our company’s stock in the last 5 years. We have about 51,000 employees working in 80 countries.

I offer these data points from the perspective of a general counsel who is required to run his department just as other corporate departments are run. This is more and more the case in American industry. The legal department in Cisco is as metrics-driven as manufacturing, HR or sales. I’ve got 4.7 employees in my department per billion of revenue, total legal spend is about .38 percent of company revenue, and non litigation spend about .16 percent. I spend $3 8 M internally, and about $ 80 million per year with outside counsel. I know just where I stand on these metrics vs. my peers, because we share the data. My numbers are pretty good, but I still don’t know how to be as efficient as Larry Tu at Dell.

The bottom line is that I’m driven by the same need for productivity improvements as is the rest of the company. It’s simple. As Cisco gets bigger, the share of revenue devoted to legal expense needs to gets smaller. Letters from law firms telling me how much billing rates are going up next year are therefore totally irrelevant to me, or as we say in Silicon Valley, orthogonal to my concerns. Think about it: not one of the CIOs of your firms expects to get a letter from Cisco explaining how much more our products will cost next year. And not one of our suppliers comes to us to tell us how much their prices will go up next year. So from my perspective, I don’t care what billing rates are. I care about productivity and outputs.

Turning then to the first of the three questions, how is technology driving change in knowledge-based industries?

My core message is that access to information is being simplified. The price of information is being driven toward its marginal cost of production. Traditional command and control organizations – think the record labels – find themselves outmaneuvered by small decentralized organizations who know how to build networks – think of Kazaa.

How many people here have read Tom Friedman’s The World is Flat? Friedman is right. Easier access to information is revolutionizing the global economy. I was at a community lecture a couple of years ago by Michael Spence, who won the 2001 Nobel in Economics. He said the networking of computers as the most important development in economic history since the opening of trade routes from Europe to Asia in the late Middle Ages. The reason: because where work gets done, and how it gets done, is being radically altered. The great human network that we have created is having a profound impact around the planet.

People who thought they had a corner on information find that’s no longer the case. I was talking with a friend recently who is a senior technology officer at a large high tech company. She is from India and was describing a problem a friend of hers in India was having -- the friend’s son wanted very much to go to one of the IITs, or India Institute of Technology campuses. They were so oversubscribed, with the emergence of 300 million middle-class Indians seeking advancement, that he was rejected. The parents were complaining that because of that, their son was forced to go to Cornell. Now everyone I tell that story to laughs at first. But there’s a moral there – the corner on information, on knowledge, on the transmission of knowledge, that we think we have in this country, that we think we have in this profession, just isn’t there any more.

What’s happened in the recording industry provides a great example. Tower Records’ liquidation is the end of an era. iTunes and Kazaa, represent the beginning of a new one. Recording industry revenues are down 25% in the last five years. The ability for any centralized organization to dictate how information will be packaged and delivered is going to zero, as individuals take control of how information and knowledge is generated and offered.

With Trip Advisor and ePinions, what is the role of Fodor’s and Frommer’s? With Wikipedia, what is the role of Brittanica? With Amazon and reader reviews and blogs, what is the role of the bookstore? Did you know that the membership in the American Booksellers’ Association has declined from over 4,000 to about 1,800 in the last twelve years? There was no law of nature dictating that this would happen between 1994 and 2006. It happened because of technology. One bookseller said he knew it was over when he saw the mailman delivering packages from Amazon to the tenant upstairs. With eBay and craigslist, what is the economic model for daily newspapers? From printing boarding passes to tracking packages, to repairing complex software to deciding where to dine and stay and how to buy a plane ticket, jobs that used to be done by human beings – and often highly trained human beings at that – are now accomplished through well designed expert systems.

Check out a fascinating new book called The Starfish and The Spider by Rod Beckstrom and Ori Brafman. They show the power of decentralized, knowledge sharing technologies to undermine whole industries which are based on a command and control approach to information. Simply stated, people around the world are building their own communities to connect with each other and share knowledge.

Political leaders recognize the fundamental nature of this transformation. I saw in the paper two weeks ago that the acting President of Turkmenistan kicked off his election campaign with a call for greater Internet connectivity. Put that in the time-warp category: how would you have reacted if twenty years ago someone told you the acting President of Turkmenistan kicked off his election campaign with a call for greater Internet connectivity? I was at a dinner several weeks ago with Alejandro Toledo, who until July of last year was President of Peru. Toledo had grown up as one of 16 children in a destitute village in the Andes highlands. Thanks to having met Peace Corps volunteers at the age of 14 he got a scholarship to the US. He has two graduate degrees from Stanford, and is the first person of native American descent to lead his country. 46% of Peruvians live on less than $2 per day. Toledo is passionate about helping the poor in Peru. He told me his first priority is education generally, and his second is getting the people of his country connected to the Internet.

So for question number 1 -- how is technology driving change in knowledge-based industries? -- my answer is that the networking of computers is transforming the nature of knowledge accumulation and distribution.

So let’s turn to question 2: what are the key areas of vulnerability in the legal services business to these technological changes?

At a famous presentation at Black and Decker, a consultant held up one of these, a drill, and asked the Black and Decker executives if this is what they sold. They all recognized the product and answered “yes”. He then suggested to them, that from the customer’s point of view, what they are selling is this, a hole in a board.

From the law firm think perspective, “sales” too often means a one to one relationship with a lawyer who bills by the hour. As a client, I can tell you what I want to buy is access to information, strategy, and negotiation, and, in the case of litigation, to courtroom skill as well.

There’s a fundamental misalignment at work here. Law firms cannot afford to own the business risks of their clients, have a lot of employees to pay and also have to allocate the limited resources of extraordinary star partners. On the other hand, we clients want access to information and counseling and want to pay for value received. Put most bluntly, the most fundamental misalignment of interests is between clients who are driven to manage expenses, and law firms which are compensated by the hour.

The current system also misserves the lawyers themselves, particularly the associates, also known as the next generation of partners.

In most of my major law firms, I see more and more problems retaining associates. I am inundated with resumes of top notch associates who don’t want to work in large law firms any more. The Wall Street Journal Law Blog included a note recently that associate turnover in large firms from 2001-2004 was 19%, with one major firm over 30%. The chairman of one firm told me that only people in their 50s and 60s are willing to put in long hours these days, that associates regularly turn down the chance to work on major deals if it interferes with social plans or a vacation. He finds a lot of younger lawyers self-centered and self-indulgent. Since I’m 50, I wasn’t personally insulted. But this reminded me of something I read recently, a complaint that “affluent parents have become role models for luxury and licentiousness, and have moved far away from caring about whether their children develop habits of discipline and self-restraint. As a result, young people are increasingly impudent and have a total disregard of the respect they owe to themselves and others.” Pretty strong stuff. This was written by Tacitus in 75 AD.

Those who grew up with the Internet just view the world differently than you and I do. I’d like to ask everyone to raise your left arms. Go ahead. Left arms up. Now, everyone who is wearing a watch, put your arm down. I will tell you, that if all of us were under 30, the results would be the reverse. People under 30 do not wear watches. They use their cellphones. My college senior daughter wants a wristwatch to wear exclusively at job interviews, since she thinks she’s supposed to. My friends, we are dinosaurs, we don’t get it.

The difference in outlook goes deeper than that of course. Some of you may know Dick Gross, a mathematician who is Dean of Harvard College. I once heard him tell a group of parents that if they want to communicate with college-age kids, they better learn Instant Messaging. He told of coming into his 16 year old son’s room while the son was doing homework, and finding five IM conversations going at once on the computer. He asked, “How can you get work done when you have five conversations going?” His son answered, “Dad, you don’t understand, this is how we communicate. For us, IM is like email was when you were a kid.” I must ask, “If five conversations are open at once, how do you bill the time?”

This generation, brought up on Wikipedia and Kazaa, believes that information should be free. Upending one’s life to support inefficient means of communication, driven by a billable hour system, to maintain a relatively slim chance of making partner, just doesn’t cut it. And when the next generation heads for the exits, it’s a sign of a business model under stress.

But if the economic system of the firm is frustrating to associates and even some partners, I can tell you that from the standpoint of a metric driven general counsel, it is more than incomprehensible. It looks like the last vestige of the medieval guild system to survive into the 21st century.

About a year ago, I testified before a House subcommittee regarding the Internet in China. It was a lengthy hearing, and it was grueling. I felt I'd been able to answer the questions pretty fully , largely because I’d spent two days beforehand being prepared by Ambassador Charlene Barshefsky at WilmerHale. If you shouldn’t leave home without American Express, you shouldn’t go to the House without Charlene. At the risk of mixing my credit card metaphors, her help was priceless. The total bill for her services was about $10,000. I have spent 300 times that amount to get mediocre assistance in patent disputes.

The legal industry has spent millions on IT to up speed access to information. But the only way I can get that information is through an individual billing me by the hour. My in-house team often has more sophistication than the associates who mine the knowledge management system to generate a memo. We’re just not allowed to access the information without paying for someone’s time.

The systems exist today to change the delivery of legal information to clients. But that change would challenge a model that today delivers high profits. Every big company, including Cisco, is using those systems to make our support services more effective, and to drive down the costs of providing service. Law firms are not. Clay Christensen of Harvard Business School has written, and I quote, “Large American law firms are just about the most profitable businesses in the world. Speedier information-gathering capabilities allow large law firms to increase utilization of less experienced lawyers without passing cost savings on to their customers.” So changing the service delivery model will be disruptive, and not just because associates are kept busy doing work that a machine might be able to do better. Changing that model will also cut into the effectiveness of cross-selling. From a client’s point of view, cross-selling is an effort of star partners to leverage the loyalty they have earned to drive hourly work to other parts of the firm. Today, there is little incentive for law firms to apply risk-reward logic to the amount of legal services provided. And General Counsel know that.

The growing scope of knowledge availability will endanger this system.

When technological change comes, it is easy to get left behind. Richard Susskind, who’s a brilliant English commentator on the legal profession, and who gave me the Black and Decker example I offered earlier, observes that when law gets standardized, it can be outsourced, co-sourced, integrated, aggregated, syndicated and shared. One-to-one consultative advice gives way to one-to-many information services. And the client becomes empowered.

My contention is that the very source of success for firms today – the ability to manage client access to information and require clients to use bespoke 1:1 systems – will be the source of failure in the future.

So my answer to question number two is that the greatest vulnerability of the legal industry today is a failure to make information more accessible to clients, to drive models based on value and efficiency. The present system is leading to unhappy lawyers and unhappy clients. The center will not hold.

And that brings me to the third question: What will it take to succeed in this changed environment?

Clay Christensen got it right when he said of our industry, “the forces that act upon service sector businesses are the same that act upon all companies.” And he predicted that a new class of providers will “develop new delivery models that will be highly disruptive to established firms.”

My answer to this question is therefore simple: first, winners will be those who are able to standardize services to meet clients’ cost management and predictability needs where very good is good enough. Second, those who can differentiate themselves by providing the top notch of customized services, where that is needed, will also win. In some cases, one firm may be able to do both. But my bet is that despite the consolidation trend we’re seeing today, top quality boutiques will thrive while the cost structures of larger centralized firms will put them at risk.

All around the periphery of the legal industry, standardization of information is happening. Check out www.taxalmanac.org, which uses wiki to create sophisticated, easily-searchable on-line discussions, and ultimately counseling, by tax professionals on a variety of topics. The legal work of generating residential leases and individual tax returns is now largely done by software.

Let me give you a few examples of the way this is now spreading to first tier corporate legal work. Let’s start with patent prosecution. At Intel, Bruce Sewell bundles patent disclosures and prosecution of the applications is awarded based on a reverse auction. The most successful firm is in Australia. At GE, Brackett Denniston has over 60 patent lawyers and agents, US trained and supervised, working to prosecute patents at GE’s Global Research Center in Bangalore. At Cisco, we pay a fixed fee for patent prosecution, and advise our firms to find ways to lower costs, since the amount we will pay will go down by at least 5% each year. We’ve got a fixed fee arrangement to review the offers of licenses which seem to arrive quite regularly these days. Bart Showalter, the partner at Baker Botts who leads that effort for us, said the fixed fee scared them at first, but over time they developed a systematic approach to the work, and as he put it, “the system made us more efficient.” To get the measurable results we need, we are driving the use of knowledge sharing technology throughout the process.

In the corporate secretarial arena, at Cisco we got tired of the choice between the overhead of dealing with a hodge-podge of local firms and high billable hour rates from so-called global firms. So we are working with one firm on a solution. We’re aiming for a 20% cost reduction compared to our current global costs. Now this firm doesn’t have a huge global network of offices – but is ready to revolutionize the way information is processed and shared. Our goal will be accomplished by standardization of forms and open interfaces, making a smooth multi-vendor operation out of what had been a series of job shops. And we want to help them to sell this approach to other companies and other law firms.

In contract processing, we have an online contract builder that allows our employees globally to build their own NDAs and other contracts. With electronic approval and digital signature, they can go from creation to execution to archiving. Five years ago, Cisco had to build its own system. Today we’re buying off the shelf. Within the next five years, a substantial proportion of the Fortune 500 will be doing the same.

Counseling will be the next frontier, as tools like taxalmanac spread to other legal areas, from sweepstakes and promotions to export regulations to human resources to securities law compliance. We’re working with eight other Fortune 500 companies, and a number of law firms, to create a site called Legal On Ramp. Legal On Ramp will allow direct access to search the firms’ KM systems. The site will use Wiki technology to drive collaboration. If you don’t know what a wiki is, I suggest you learn very quickly. And you can bet securities work, especially ’34 Act and Section 16 compliance, will be one of the first targets. (More information on this at: www.legalonramp.com.)

Today, all of Cisco’s US corporate, securities and M&A work is done superbly by Fenwick and West operating on a fixed fee. Gordy Davidson came to me recently and offered to keep the fixed fee the same this year. He thought he was being generous, or at least practical. I turned him down. I told him I wanted a cost reduction. But my goal wasn’t to reduce my costs while hurting Fenwick’s profitability. I suggested he propose a service level agreement for me, his client, to fulfill. The SLA will oblige Cisco to take on lowest -value-add tasks that lawyers were doing, and that we can do ourselves with our administrative staff. I told him we would share the savings. In this way, we become a better client, and we both win.

We are doing the same thing in litigation. We have a fixed fee with Morgan Lewis for all of our US commercial litigation. Not surprisingly this has made Cisco litigation avoidance a key goal of Morgan Lewis. We’re driving down the time that human beings have to spend reviewing electronic documents. We bid out discovery work based on cost per gigabyte. In some cases we’ve outsourced document production to a different law firm than the firm that is providing counseling or other support. But what we had to build ourselves five years ago is now becoming the norm.

Now as I said at the outset, you may disagree completely with my analysis, with my prescriptions, or both. You might even think I’m just trying to sell more networking equipment. But I ask each of you to grapple with the three questions I posed and come to your own conclusions.

How is technology driving change in knowledge-based industries? What are the key areas of vulnerability in the legal services business to these technological changes? And what will it take to succeed in the new environment?

The opportunity is there to recognize the business realities that will be driven by new technology. We can seize the chance to offer more value to clients. We can seize the opportunity for our own employees to be more engaged and productive.

Our mutual success depends on it. I’m fortunate to have great counselors like Gordy, Charlene, and Bart. They’ve helped ensure, through past practice and good preparation, that my company has no issues with its stock options, minimal comments on our 10-Ks, and only one piece of litigation listed in the last 10-Q, and that one has subsequently been resolved. I need those counselors to themselves have healthy businesses. Successful outside counsel is an integral part of Cisco’s success.

We should all be very proud of our profession. We help drive compliance with the democratically-enacted laws of our country. In the last five years, we’ve accomplished extraordinary things. Since the dark days of the Enron collapse and the advent of Sarbanes Oxley, we’ve restored credibility to the institutions that are the backbone and the motor of the greatest economy in the world. We defend those who have done the indefensible, even when the government threatens us for those efforts. We work to preserve the rule of law. In our daily work we do not fear, in fact it is our obligation, to speak truth to power.

We are in the midst of an economic revolution that is the most important event in economic history since trade routes opened from Europe to Asia. We must reach out and seize the golden ring that is just within our grasp.

Thank you for your attention today

Posted by John Earnhardt at 02:13 PM Permalink | Comments (5) | TrackBacks (4)

Donors Conference for Lebanon Raises $7.8 BILLION

Today in Paris, donor nations, government and business leaders came together to address the economic and rebuilding issues that Lebanon is facing as a nation. The conference was hosted by French President Jacques Chirac and the group includes Lebanon Prime Minister Fouad Siniora, U.S. Secretary of State Condoleezza Rice and business leaders, including our own John Chambers. Prime Minister Siniora is quoted in a Reuters story as saying, "Even in times of great despair our determination has never diminished. We have faith in the people of Lebanon."

Other business executives leading this effort are Microsoft CEO Steve Ballmer, Intel Chairman Craig Barrett, Yousif Ghafari, Chairman, GHAFARI, Inc.; and Dr. Ray Irani, Chairman, President and CEO, Occidental Petroleum Corporation. They were asked to lead this effort in September by U.S. President George Bush.

Chambers stated, "Only occasionally do you have an opportunity to make a difference in a person’s life, much less in a community. Through this partnership, we have a chance to make a difference in a country and perhaps even a region." You can read a full Q&A on the Lebanon Partnership with Chambers here. Information on the Lebanon Partnership here.

More info on the partnership, as well as quotes from Prime Minister Siniora, Secretary Rice and the business leaders involved, can be accessed on the press release here.

Posted by John Earnhardt at 12:29 PM Permalink | Comments (0) | TrackBacks (0)

January 22, 2007

Taking Umbrage With WSJ's Holman Jenkins Over iPhone Column

The old adage in communications is never pick a fight with someone who buys ink by the barrel. However, there isn't an equal adage for 1's and 0's, so, hence, as Cisco invented the router and the network which is the platform for all current communications, I think it is appropriate to respond to Wall Street Journal columnist Holman Jenkins on this Cisco blog. (Note: please read this blog's disclaimer...I am clearly speaking for myself here.)

He wrote a column last week (January 17th) entitled "iFoodfight" about the iPhone trademark and Cisco's suit against Apple. If you have a WSJ subscription, you can read it online here. He's a good writer and a good columnist, but I had to wait a few days to respond so I could calm down in response to this one. Here is what I would write him:

Dear Mr. Jenkins:

Your piece on the iPhone ("iFoodfight," January 17, 2007) issue deserves comment. First, you write an opinion piece, so you are entitled to say what you want. However, to suggest that one should "love" a company for using a trademark that is owned by someone else is, to use Apple's own words to respond to our lawsuit, "silly." In this era of post-Enron, backdating options and trying to win back investors confidence in the marketplace, playing by the rules should be championed, flaunting rules should not be.

Further, to suggest that Cisco doesn't make products that people care about is to say that people don't care about broadband, internet security, wireless access, video connectivity, VoIP and the whole networked universe. As 80% of all internet traffic touches Cisco equipment at some point, I think you might need to reassess what people care about. Last I checked, this Internet thing is pretty popular.

Lastly, you write, the impression is that "Cisco's business plan for 'iPhone' never amounted to more than an urge to exploit Apple's intention to launch a product of the same name." To be clear, the iPhone trademark dates back to 1996 with Infogear, which Cisco acquired in 2000. If we or Infogear were that prescient in 1996 to think that someday we could sue Apple for their infringing on our iPhone trademark at some point some eleven years later, then we deserve all the credit in the world.

Best,

John Earnhardt
Senior Manager, Media Operations
Cisco Systems, Inc.

Posted by John Earnhardt at 05:21 PM Permalink | Comments (5) | TrackBacks (0)

January 20, 2007

Open Source Researcher Alerts Cisco to GPL Issue

Last week, an open-source software researcher, Armijn Hemel, a consultant with Loohuis Consulting, alerted some bloggers and other media about one of our iPhone models (WIP300) not being compliant with the GNU general public license. Cisco has thoroughly investigated the information Mr. Hemel brought to our attention related to the Cisco iPhone WIP300 model as reported. Based on our investigation, Cisco is taking steps to resolve a single issue raised regarding this product’s compliance with the GNU General Public License, or GPL.

Cisco has thoroughly investigated the other issues raised and verified the product’s compliance with the GPL. We thank Mr. Hemel for apprising us of this matter and we encourage others in the open-source community to continue working with Cisco in these important areas of research and development. Compliance with open standards is very important to us and we will continue to take the necessary actions to ensure we are meeting the requirements of open source licenses we use.

Posted by John Earnhardt at 09:36 AM Permalink | Comments (1) | TrackBacks (1)

January 19, 2007

Awards Season Results Are In: Cisco Best Company to Work For

The Golden Globes. The Oscars. The Bloggies. The Fortune "Best Companies to Work For." Some of them have been announced, some are coming soon.

Cisco was not nominated for The Golden Globes or the Oscars this year, but for the 10th year in a row, Cisco has been named one of The 100 Best Companies to Work For in the U.S by Fortune Magazine. In 2007, Cisco is number 11, up from number 25 in 2006, making the company the largest technology employer in the top 20.

What makes Cisco a great place to work? In my estimation (I wasn't surveyed), smart people; smart, innovative, relevant products; an aspirational mission to change the way we work, live, learn and play through the network; on-site dental, daycare, haircuts, oilchanges, drycleaning; ownership: virtually all employees are shareholders; and last, but not least, a real passion among employees and our executive team that we really are making a difference in the world by connecting people through the network, whether it is for healthcare, entertainment, education, retail, research or whatever. While you may think it sounds cheesy, we truly believe that the network is the platform for all of life's interactions. Who makes that network? That's right, the #11 best place to work in America and proud of it!!

Congratulations, of course, to our Silicon Valley neighbors who also made the list: Google (#1), Genentech (#2), Network Appliance (#6), Adobe Systems (#31), Intuit (#33) and Yahoo! (#44).

Posted by John Earnhardt at 03:22 PM Permalink | Comments (0) | TrackBacks (0)

January 18, 2007

Blogosphere is Alive and Well

In the past week and a half or so, because of our suit against Apple for infringing on our iPhone trademark, I've nearly spent more time on other blog sites than I have in the previous two years since I started blogging at Cisco. I've come across a lot of very interesting and thoughtful bloggers (as well as some very funny ones) and thought that I'd highlight a few of them for your reading pleasure. This is, in no way, an exhaustive list and if your favorite tech blog isn't listed, please comment and I'll publish it. As a nominator for this year's Bloggies I may or may not have voted for some of the blogs listed below. It's a secret ballot, so I'll never tell.

TechCrunch - Most of you already know this blog, but I still highlight it as a quality resource for learning about technology trends and culture.
GigaOm - Ditto
SiliconValleyWatcher - Ditto
The Secret Diary of Steve Jobs - very well written and very funny.
"Between the Lines" blog at ZDNET with Dan Farber and Larry Dignan - In the know and a good read. Ed Burnette should also be called out for his analysis work on his ZDNet blog as well as covering "software, gadgets and games."
ValleyWag - well described as a "tech gossip rag."
Crunchgear - Ditto to #1.
And, last but not least, of course the ever utilized and ever useful Technorati and Digg.

Thanks for the good reading, bloggers, and keep up the good work.

Posted by John Earnhardt at 12:10 PM Permalink | Comments (0) | TrackBacks (0)

Beam Me Up to the Store of the Future

Sign me up for one of those biometric scanners at the cash register. I’m tired of having to scavenge around for my wallet, extract my debit card, slide it through the card scanner, and punch in all the codes and buttons. Let me just press my finger on the reader and be on my way with my groceries.

And I won’t mind punching my size 36 x 30 into a kiosk if lights begin flashing to guide me to my correct size in Lee jeans. I don’t mind giving up the hunt each time I’ve got to rummage through 20 pairs of jeans to find my size.

I’m starting to like this idea of the store of the future that’s being talked about here on News@Cisco and at the National Retail Federation convention in New York City. Digital signage, which Cisco is introducing at the show, will certainly enliven the store experience. I’m looking forward to attending an Oakland A’s baseball game at CiscoField where digital signage will recognize me as I walk by and offer me the opportunity to upgrade my tickets on my cell phone. Just hope I have the funds in my account to afford the 3rd-base side tickets!

Information Week quotes Cisco general manager Thomas Wyatt who spoke Tuesday at the National Retail Federation convention, saying that “more and more stores are differentiating themselves by providing much more compelling in-store content.” He says consumers expect stores, banks, health providers, and others to deliver compelling digital content and targeted networked displays that include video, graphics, animation, streaming Web, and television content and text.

Sounds good, if it treads lightly on the advertising and helps speed my store experience or makes it more enjoyable. The other day I was waiting in line at the post office dreading the long wait when I eyed a 48-inch plasma TV above me. In the US post office, of all places! It was playing CNN and, the news junkie that I am, I was engaged. Time passed so fast I was at the counter before I had gotten my fill of the news-of-the-moment. Now that’s progress!

Posted by David Barry at 06:22 AM Permalink | Comments (0) | TrackBacks (0)

January 16, 2007

Cisco to Blogosphere: We're Listening

We've been following our iPhone trademark issue in the blogosphere closely and it's been interesting to see the commentary from some posters suggesting that somehow Cisco either in the US or Europe didn't meet the requirements to maintain the iPhone trademark. Our response is pretty simple: We have met all elements required by all authorities to maintain our mark. We've been pretty direct about the fact that we've been shipping the iPhone since last spring.

Posted by John Earnhardt at 09:31 AM Permalink | Comments (7) | TrackBacks (0)

January 12, 2007

UPDATE on Cisco's iPhone Trademark

Commentary from Mark Chandler, Cisco's SVP and General Counsel, on Apple's infringement of Cisco's iPhone trademark.

Today’s announcement from Cisco regarding our suit with Apple over our iPhone trademark has spurred a lot of interesting questions. Most importantly, this is not a suit against Apple’s innovation, their modern design, or their cool phone. It is not a suit about money or royalties. This is a suit about trademark infringement.

Cisco owns the iPhone trademark. We have since 2000, when we bought a company called Infogear Technology, which had developed a product that combined web access and telephone. Infogear’s registrations for the mark date to 1996, before iMacs and iPods were even glimmers in Apple’s eye. We shipped and/or supported that iPhone product for years. We have been shipping new, updated iPhone products since last spring, and had a formal launch late last year. Apple knows this; they approached us about the iPhone trademark as far back as 2001, and have approached us several times over the past year.

For the last few weeks, we have been in serious discussions with Apple over how the two companies could work together and share the iPhone trademark. We genuinely believed that we were going to be able to reach an agreement and Apple’s communications with us suggested they supported that goal. We negotiated in good faith with every intention to reach a reasonable agreement with Apple by which we would share the iPhone brand.

So, I was surprised and disappointed when Apple decided to go ahead and announce their new product with our trademarked name without reaching an agreement. It was essentially the equivalent of “we’re too busy.” Despite being very close to an agreement, we had no substantive communication from Apple after 8pm Monday, including after their launch, when we made clear we expected closure. What were the issues at the table that kept us from an agreement? Was it money? No. Was it a royalty on every Apple phone? No. Was it an exchange for Cisco products or services? No.

Fundamentally we wanted an open approach. We hoped our products could interoperate in the future. In our view, the network provides the basis to make this happen—it provides the foundation of innovation that allows converged devices to deliver the services that consumers want. Our goal was to take that to the next level by facilitating collaboration with Apple. And we wanted to make sure to differentiate the brands in a way that could work for both companies and not confuse people, since our products combine both web access and voice telephony. That’s it. Openness and clarity.

At MacWorld, Apple discussed the patents pending on their new phone technology. They clearly seem to value intellectual property. If the tables were turned, do you think Apple would allow someone to blatantly infringe on their rights? How would Apple react if someone launched a product called iPod but claimed it was ok to use the name because it used a different video format? Would that be ok? We know the answer – Apple is a very aggressive enforcer of their trademark rights. And that needs to be a two-way street.

This lawsuit is about Cisco's obligation to protect its trademark in the face of a willful violation. Our goal was collaboration. The action we have taken today is about not using people’s property without permission.

Cisco Press Release on this issue can be viewed here: http://newsroom.cisco.com/dlls/2007/corp_011007.html.

Posted by Cisco PR at 04:36 PM Permalink | Comments (320) | TrackBacks (5)

January 09, 2007

Consumer-Controlled Experiences to Drive Future Connected Home and Beyond says Chambers at CES 07

Cisco CEO and chairman John Chambers painted a compelling portrait today of the future connected home and the connected consumer at the 2007 Consumer Electronics Show in Las Vegas. In this future we will see the convergence of all forms of human expression across any device, anywhere at anytime, and that Cisco will be a dominant player in this market.

To achieve this exciting future, Chambers insisted that siloed applications that now rule the home will be destroyed. Video will be the killer application. But it will converge with voice, data and mobility across the intelligent network. To succeed, this network and future environment must be open, simple for the consumer to use, safe and virtual (available anytime, anywhere, on any device).

To help give substance to his overarching vision, Chambers once again drew upon the services of his reliable demo-in-chief, Jim Grubb. The two started out in a simulated car where Jim demonstrated how he could begin a song by selecting it on his in-dash digital player (Hotel California by the Eagles), then seamlessly have it continue on his cell phone when he left the car. Moving across the stage to the living room with Chambers, Jim clicked on the phone to have the song continue playing on the large flat-panel TV—but accompanied this time with a video clip of the Eagles in concert (highlighting the network intelligence to recognize the unique attributes of the device).

What was impressive about the demo was not necessarily the application itself, but the simplicity of it. How the network intelligently combined many complex technologies across many different environments. And how the network seamlessly moved the content from device to device, always aware of and ready to offer the consumer the special media types available on each particular device (such as video on the TV).

Chambers continued that consumers will drive these changes, not businesses as has been the case in the past. He insisted these changes will alter not just entertainment but also revenue streams as it will enable the delivery of new services, devices, and content. The consumer-controlled experience will usher in new services such as the ease of updating tickets at the future Cisco Field on a consumer’s cell phone. Or the ability to view an instant replay on the same cell phone while in the stands from 30 different angles.

The network becomes the platform that enables new user experiences in a most compelling future.

Posted by David Barry at 04:43 PM Permalink | Comments (0) | TrackBacks (0)

Cisco’s iPhone Trademark

Given Apple’s numerous requests for permissions to use Cisco’s iPhone trademark over the past several years and our extensive discussions with them recently, it is our belief that with their announcement today, Apple intends to agree to the final document and public statement that were distributed to them last night and that addressed a few remaining items. We expect to receive a signed agreement today.

Penny Bruce, Director, Corporate Public Relations, Cisco

Posted by Penny Bruce at 11:10 AM Permalink | Comments (2) | TrackBacks (0)

Cisco Connected Home Debuts at CES

At CES, John Chambers will be speaking about the Connected Home, Cisco’s vision for the future. On the News@Cisco site, Chief development officer, Charlie Giancarlo, discussed how networking technology is changing digital communications and entertainment.

Cisco launched its Second Life presence in December, and is now bringing the connected home to life in Second Life. At CES, as Cisco talks about its view of the future, Cisco is presenting its view of the future in Second Life with the Cisco Connected Home.

In the Cisco Connected Home, Cisco will be showcasing its current home products, and the new products being unveiled at CES by Scientific Atlanta and Linksys. Set-up like an everyday home, the Connected Home has all the bells and whistles of how the future home will operate: the ability to control entertainment and security through one network. Plus, in the Connected Home, you can click on any of the products to learn more and get a feel for how the products work in real life.

Imagine watching a movie in your bedroom on the HD screen, and being able to have a pull-down menu for all your choices – or just the choices for your children’s rooms? The Cisco Connected Home has that option already. Imagine each bedroom having its own library of music, piped in during the day? Or, actually have a real connection in the kitchen, pulling down menu choices and recipes. With the Connected Home, each room connects to a server and you can choose the music to fit the day.

Or, imagine watching John Chambers, CEO and Chairman of Cisco Systems, and his keynote speech on your Connected Home television – you can, in Second Life.

To celebrate the launch of the Connected Home and CES, Cisco will be giving away a Real Life iPhone each day during the show, and is having a reception with Rob (Cisco Systems) and Mike (Cisco Systems) on Tuesday, January 9 at 4:00 PM PST / LST on Cisco Island.

See you there!

Posted by David Barry at 05:00 AM Permalink | Comments (0) | TrackBacks (0)

Seven New iPhones Head Cisco Linksys Announcements at CES

Extending the power of presence technology to mobile IP phones, two of the new seven iPhones that Linksys introduced today at CES integrate popular communication clients, Skype and Yahoo! Messenger with Voice, into the handset. These new iPhones allow you to see when friends or family are online and ready to receive a call. What’s more, these client-enabled iPhones free you from having to sit at your PC to talk and also free you from having to keep the PC always-on to make calls over the Internet.

In addition to enabling mobility and voice calls, the Dual-Mode Cordless Phone for Yahoo! Messenger with Voice allows access to Yahoo information services. Skip hunting for the phone book or returning to your computer to search for a phone number. Do it from the phone and also check weather forecasts directly from the phone’s display.

Dual Mode Internet Telephony Kit with Integrated Skype (iPhone®)
Wireless-G Phone for Skype (iPhone®)

Here are some of the other Linksys announcements at the show:

• PowerLine networking products designed for HomePlug AV, the next generation of PowerLine standards from the HomePlug PowerLine Alliance, providing up to 100 Mbps speeds with existing wiring.

• New NAS2000 network attached storage product for home and SOHO users. Includes two bays and doesn’t require a client utility to run on the PC.

• The WPSM54G wireless print server that allows users to wirelessly scan, fax and copy from any PC on the network to a multifunction printer without needing a separate dedicated “always-on” PC.

Posted by David Barry at 04:41 AM Permalink | Comments (0) | TrackBacks (0)

Scientific Atlanta at CES 2007

Scientific Atlanta, a Cisco company, will be much in evidence at the 2007 Consumer Electronics Show in Las Vegas. Scientific Atlanta gear will be a key part of The Connected Home, Cisco’s evolving vision to provider consumers at home access to all types of content (premium video, photos, music, data, voice and home video) on televisions, personal computers, cell phones and mobile devices.

Scientific Atlanta will also demonstrate Direct to Disc. This product concept will enable consumers to purchase on-demand video, music or software from their service provider and then––using Scientific Atlanta’s DVR with built-in DVD set-top––record the content to a disc.

Separable Security Technologies
A full suite of products to help enable cable operators to meet the FCC "707" separable security mandate will also be demonstrated at CES 2007. Such products include Scientific Atlanta's Multi-Stream CableCARD™ and a range of set-tops, from standard-definition digital-only to dual-tuner high-definition (HD) DVRs.

Posted by David Barry at 04:33 AM Permalink | Comments (1) | TrackBacks (0)

January 05, 2007

Cisco Solution Provider Weighs in on IronPort Acquisition

In a follow-up article to the Cisco announcement of the acquisition of leading messaging security vendor, IronPort, ChannelWebNews quoted the CEO of Atrion Networking, which works with both Cisco and IronPort, on the ideal timing of the purchase.

“We’re seeing a number of people that I would call early adopters [replacing their mail security solutions] in the last year and really looking for more manageable, easier-to-use, higher-performance solutions. You’re going to see an explosion of anti-spam/mail security-type solutions being purchased and replaced in the next few years.”

In that vein, InfoWorld noted that spam, which had fallen off the enterprise security radar in recent years, has become a hot issue again, as a new breed of “image” spam has found a way around spam filters and filled up enterprise inboxes once again.

IronPort’s own statistics from its customer installations show a 100 percent year-over-year increase in spam message volume to 63 billion messages per day in October, 2006. This isn’t really startling news for many of us that endure this stuff piling up in our inboxes or junk boxes in the past few months. It just shows the determination of vendors or hackers everywhere to serve this black market.

In terms of the global network security market, Cisco continues to lead with 38 percent share in the third quarter of 2006, according to Synergy Research Group. Check Point Software Technologies Ltd., run from Ramat-Gan, Israel, and Redwood City, California, was second at 9.9 percent, followed by Juniper Networks Inc. at 9.2 percent.

Posted by David Barry at 10:40 AM Permalink | Comments (0) | TrackBacks (0)