The past few weeks have revealed what a tough industry the IT industry can be. Many stalwarts, competitors among them, have struggled to meet their financial targets, citing a variety of factors from the macro-economic environment to more aggressive competition from rivals, including Cisco.
It’s no secret that Cisco has performed consistently well during the same period, and I am proud to have played a part in driving us to another record revenue quarter. Moreover, I’m delighted with the progress in our wireless business, where we reported sequential and profitable growth of 27% year-over-year.
How did we do it? Not by any cut-throat measures, as some rivals have suggested (in fact, our pricing policies haven’t changed in recent months, and our customers have the choice to buy products in combination or individually), but by doing what matters most: listening to customers, and innovating with pace and focus. Here are my top five reasons why Cisco’s innovations and acquisitions are winning us market share in the wireless sector:
Customers want an architectural approach – 69% of the costs of running networks are incurred after the initial equipment purchase, with 47% coming in the form of labor costs. Think about how managing wireless and wired networks separately adds to those costs. By offering customers the choice to unify wired, wireless and virtual private networks (VPNs), into a single, highly secure network infrastructure, Cisco’s Unified Access architectural approach puts money back in our customers’ pockets. That’s a key reason we’re winning.
RelentlessInnovation Will Always Win Out – The innovations behind our Unified Access architecture are built on an engineering capability few rivals can match. The Unified Access Data Plane (UADP) ASIC that is central to our Unified Access strategy is a great example of the outstanding results our $6Bn+ annual R&D investment buys us. Silicon engineering is expensive. Competitors can’t solve customers’ problems with as much specificity and focus as Cisco can. Our approximately 650 silicon engineers give Cisco a huge innovation advantage.
Wireless is About Delivering Mobile Experiences, not just Connectivity – Getting connected is becoming table stakes. Our customers want solutions that enable them to use the information about how and where their customers are connected to provide them with better location-based services, and superior experiences. The acquisition of ThinkSmart gave us a big advantage in this area, one that we’re already putting to good use through our partnership with AT&T and others.
We’re Helping Service Providers Transform their Networks for Wi-Fi – Speaking of service providers, our SP Wi-Fi strategy has delivered Cisco a strong advantage in partnering with telecommunications operators. We offer an end-to-end SP mobility architecture from access layer to the mobile packet core that our rivals simply can’t match.
We’re embracing the Cloud to further simplify Wireless Network Management for Mid-Sized Companies – Let me return to where I began: the cost and complexity of managing networks. What if you don’t have any IT staff at all? That’s the challenge that Meraki solved for thousands of customers with its Cloud Managed Networking approach that we now offer through our Cloud Networking Group. Effectively addressing the needs of mid-sized business from retailers to event venues, coffee shops to medical centers has been another key driver of our success.
I’m delighted we’re making strong progress in mobility, but we won’t rest on our laurels. Innovation takes a lot of hard work, as does anticipating the ever-changing needs of our customers.
I believe if we keep those two principles in mind, we’ll continue to enjoy many more positive quarters and, yes, we’ll do it at the expense of our rivals!
A year ago, Manchester City captured its first English Premier League (EPL) title in 44 years with one of the most incredible comebacks ever seen in the history of the sport – scoring two goals in stoppage time, the last in the waning moments of the game.
Take a look at this video, which replays that final incredible goal from multiple angles, and embrace the bedlam, unbridled passion, emotion and joy that unfolded in the stands, on the field, and everywhere in Etihad Stadium.
It’s another first for Cisco, building on recent wins such as Bayer Leverkusen, the first team in the German Bundesliga, and the Seibu Dome, home of the Seibu Lions Japanese Baseball League team. Add in facilities who implemented our solutions for recent major events, like the Mercedes-Benz Superdome (Super Bowl), and the Georgia Dome (NCAA Final Four), and we’re proud to be at the epicenter of helping our customers and partners deliver an unparalleled experience for fans.
The Special Olympics is an organisation that strives to create a better world, using the power of sport to foster the inclusion of all people, especially those living with an intellectual disability. Cisco is proud to have partnered with this organisation recently to organise the NSW Special Olympics Community Disability Sports Day.
The event was held last month at Centrebet Stadium -- home of the National Rugby League’s Penrith Panthers -- and saw 65 intellectually disabled people from Sydney’s West participate. Arriving through the same tunnel that the Penrith Panthers run out of at the start of each game, the participants had the opportunity to play a range of sports and activities, honing their skills in rugby league, cricket, football, bocce and some modified Olympic events such as javelin and discus.
Of the 65 athletes who attended, 90% had never experienced the Special Olympics before. These athletes are now able to take advantage of Special Olympics programs that offer regular sport, competition pathways, healthy lifestyle solutions and leadership opportunities.
The event took place in Lima, Peru, a country which has recently enjoyed sustained economic strength and a vigorous business revival. That resurgence has helped it join the group of countries (Brazil, Mexico, Colombia, Chile and Panama) driving Latin America’s economic development.
The topics discussed at this year’s Forum were radically different to previous years. Macro topics like macroeconomic stability, fiscal discipline and exchange rate policies, which dominated discussions at previous summits, gave way to micro topics such as the resurgence of the middle class, the future of education, competitiveness, productivity, innovation and new models for maintaining sustainable economic growth. Most conversations also contemplated the need to move in the short term, from an economy based on natural resources and raw materials, to one based on value-added sectors.
This thematic shift is due, no doubt, to the successes in Latin America in the past decade. Indeed, during the last decade, the region as a whole has seen an unprecedented economic growth, at a time when other regions of the world have stopped growing or even decreased. One proof point: in the last 10 years, Latin America added 50 million people to the middle class, and moved 70 million people of poverty. It is expected that economic growth in the region will hover around 4% in the coming years.
From the perspective of information and communication technologies ICT, the opportunities are huge. Only 10% of the population in the region has access to a fixed broadband connection today. It is anticipated that in the next five years, 400 million people will gain access to broadband, 260 million of them through wireless connections. Large investments in infrastructure will be needed to realize these goals.
From the perspective of education and jobs, it is estimated that nearly half of the 589 million people in the region are aged less than 25 years. Innovative thinking will be required to deliver appropriate education to those young people, and to create 50 million new jobs for them in the next decade. This contrasts with the shortage of ICT professionals in the region by 2015, which we estimate will be approximately 300,000 trained professionals.
Jordi Botifoll participated as a panelist in the session “New engines of growth.” In this and other discussions, we talked about the role technology and the network in particular plays to increase the competitiveness of the region and to enable productivity increases.
It is during these times of prosperity and optimism, and when the winds are in our favor, that the region needs structural reforms that will enable the region to be more competitive. And for this it is important to undertake long-term investments in critical areas such as education, technology and infrastructure and thus close the competitiveness gap with other countries.
If we do not have major changes in this regard, the region cannot maintain sustainable levels of economic growth and social inclusion. According to the Global Competitiveness rankings from WEF, among the 144 countries measured by the report, the country with the best position in the ranking from Latin America is Chile (33), followed by Panama (40), Brazil (48), Mexico (53), Peru (61), Colombia (69), Argentina (94). Still a long way to go. There are new opportunities for the region, but also great challenges ahead.
In our last blog, we talked about the next generation Internet. It will be about the Internet of Everything ─ people-to-people, machine-to-machine, machine-to-people, trillions of things coming online in coming years. Software Defined Networking (SDN) is only part of the overall solution. Real-time intelligence, automation and orchestration, instantaneous responsiveness, and unprecedented business and operational agility require a much broader approach. At Cisco we’re already creating the network of the future with our integrated framework, the Cisco Open Network Environment (Cisco ONE).
So now let’s come down to Earth and explore what all of this really means to an average service provider. What new capabilities and use cases does Cisco ONE enable right now? How does what we’re doing lay another building block for the Internet of Everything?