Is Cisco the New King of the Supercloud?

Cisco has used its Cisco Live event to buttress its Open Network Environment and the onePK API set that’s designed to address the SDN and NFV space.  In the move, Cisco is showing us why they’re able to grow sales when others are under pressure, and also why the notion of a network revolution isn’t as easy to promote as one might think.

From the first, ONE has been what many would call a cynical play, blowing kisses at things like OpenFlow and NFV to gain benefits while at the same time downplaying or even obstructing the radical change that both technology initiatives could represent.  That may well be true, but in the marketplace you don’t expect sellers to lie down and die so the next generation can trample easily over the remains.  What Cisco did that was very smart was to grasp the essential notion of SDN (and, to a lesser degree, NFV) and capture the value of that notion without promoting what would have been to Cisco hurtful technology changes.  Software control of networking is a top-down requirement.  You have to start with the software’s mechanism to exercise control and go from there, which is what onePK did.

Cisco has now announced it’s rolling ONE out across more products, but what’s really interesting is that they’re doing this under the label of “Enterprise Network Architecture”, the broad strategy Cisco is targeting at (obviously) enterprises.  Enterprise interest in SDN and NFV is significantly different from network operator interest; literacy among enterprises is about half that of operators for SDN and it’s in the statistical noise level for NFV.  However, there is interest among enterprise buyers in SDN and NFV as a means of bringing networks to heel in supplying application services the way applications want.  That’s why the onePK concept is valuable.

I think that what Cisco is doing here is building from the API boundary point in both the upward (cloud) and downward (network) directions.  If you look at its acquisition of Composite Software, a data virtualization player, you can see the beginning of what might be “cloud platform services” emerging from Cisco.  They don’t want or need to push their own version of cloud stack software—IaaS is just a platform to build valuable stuff on.  The valuable stuff is likely to come in the form of cloud platform services that can enhance applications by leveraging what makes the cloud different.  It’s no surprise that Cisco is linking enterprise mobility to this, because it’s mobility-based applications and what I’ve been calling “point-of-activity empowerment” that provide the benefit kicker that will justify any enterprise excursions into SDN, NFV, or even ultimately a large-scale commitment to the cloud.

Data virtualization, network virtualization, resource virtualization.  It’s not hard to realize that we’re moving to a virtualization-based platform, not in the old sense of VMs but in the new sense of “fully abstracted”.  We’re building a cloud operating system, just like we need to be, and Cisco may well be the player who has the clearest idea of what that might look like and how to get there without sacrificing early sales.  Not only that, by grabbing the API side of this, Cisco is going after a space where newcomers in the SDN space have been weak.  “Northbound APIs” have been that vague pie-in-the-sky thing that you pushed everything you didn’t want to implement into.  If Cisco makes APIs concrete, they expose the fact that others are really pretty simplistic in how they view them.

Cisco’s weakness in this is NFV.  They’ve lumped it into the same package as SDN, which suggests that at least for the moment Cisco is looking at NFV as a kind of SDN stepchild, which it most definitely isn’t—NFV is the value-proposition senior partner because NFV as an architecture defines the deployment and operationalization of agile, componentized, cloud-specific services and applications.  The question is whether Cisco’s NFV myopia is due to the fact that they can’t easily fit it into their current SDN/ONE approach and are waiting to see if something gels, or because Cisco actually has a grand NFV design and they don’t want to let it out yet.

I’m inclined to favor the latter conclusion here.  I think it’s obvious to many at Cisco that NFV is really creating the framework for the future of both cloud and the network, but it’s doing that creating at a layer above the network itself.  That favors Cisco’s API strategy because NFV components could reasonably exercise APIs just as any other cloud/software element could.  It’s not logical to assume that something that so easily fits with Cisco’s strategy at the API level could be held back because those APIs aren’t the same as SDN would use.  Again, the data virtualization buy suggests that Cisco is looking at virtualization in the fullest sense.

Alcatel-Lucent and NSN are increasing their SDN, NFV, and cloud articulation but it’s too early to say whether they have anything substantive to say.  Cisco has a lot of real technology pieces here, and so it’s going to be very hard for competitors to catch up if they let Cisco take a convincing lead in articulation too.  I think that anyone who doesn’t have a good SDN/NFV/Cloud story by mid-November is going to be in for a cold winter.  So…look for more M&A.

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