I remember a Cisco before John Chambers but I suspect most in the industry today do not. For those people it might seem a frightening prospect. For some who have been disappointed by Cisco’s seemingly lackluster support of new initiatives like SDN and NFV, it may seem like an opportunity. Obviously we have to see what will happen under Chuck Robbins, the new CEO, but there’s a strong chance it will be business as usual. If it is, then Cisco is making a big bet.
At a time when networking was about technology and strategy, and when network equipment vendors were usually run by technology-strategy people, Chambers brought in the sales side. He was always a salesman first, even as CEO of Cisco. One (now-ex) Cisco VP told me “John was the master of tactics over strategy.” That this worked in the enterprise market is hardly surprising, but that it also worked in the long-cycle-planning-dominated carrier market is more so. The two questions all Cisco-watchers will ask are “Is Robbins going to stay the Chambers course?” and “Will what worked for Cisco in the past work in the future?”
It’s interesting to contrast Chuck Robbins with a previous heir-apparent, Charlie Giancarlo (another “Charles”). Charlie was an intellectual, a strategist, a thinker and a technologist. Chuck is a sales and channel guy in his past jobs with Cisco, a mover and shaker in those spaces but more a newcomer than some on the Street had expected. The point is that on the surface Cisco has shied away from the strategists in favor of another tactician. One might see that as a vote against change.
I think it’s a vote against radical change, but the jury is out on a broader implication. There’s no reason for Cisco to rush to exit a game it’s winning. Operators seem to be inclined to stay the course with respect to their switch/router vendors, a fact that’s benefitted Cisco and perhaps Juniper and Alcatel-Lucent as well. Operationally and integration-wise, that’s the easiest course to take. SDN and NFV could both ease the pain of a shift in vendor, product, or even architectural strategy down the line but we’d have to have those technologies in place to do that. Cisco benefits from dragging its own feet, and even by actively suppressing motion to SDN and NFV where it can.
For now. At some point, operators will have the tools they need to accomplish a shift in strategy, and the benefit case to drive the change on a broad basis. One might be tempted to speculate that Cisco sees that point coming soon, and sees the need for Cisco to change faces to adapt to the new picture as a good time to change CEOs. What better way to justify a shift in strategy?
Some of Chuck’s early comments about the “Internet of Everything” seem to be a specific commitment to the old Cisco, though. Cisco’s primary marketing thesis for a decade has been “Traffic is going to increase, operators, so suck it up and buy Cisco stuff to carry it!” The Internet of Everything is an example of that; so what if nothing that’s being done even today is profitable for operators, there’s more coming. If a new CEO fossilizes this positioning it’s going to be hard to embrace logic and reality down the line.
Of course it’s impossible for a new CEO to sweep the Chambers Legacy down the tube. I wouldn’t either. I’ve talked with John a number of times and he’s an impressive guy. In a different frame of reference he’s like Steve Jobs (who I’ve also talked with). He understands the buyer, so even if Cisco were prepared to dis the legacy of their own chieftain (which clearly they won’t do), you can’t abandon a “sell them what they want” value proposition.
Which gets us back to the question of whether what they want is durable. Cisco or a number of other vendors could promote a vision of future networking in which the current paradigms would be largely preserved for perhaps as long as a decade. The trick is to establish the principle that operations efficiencies can cure all ills. There’s no way anyone could say that Cisco would win in a future driven by the quest for reduced capex, after all.
Which is what competitors should be thinking about. If Cisco needs the opex horse to ride to victory on, then competitors need to saddle it for their own gains. Remember the numbers from the sum of operator surveys I’ve done. Twenty years ago about a third of TCO was opex, and by the 2020s it appears that two-thirds will be opex. Worse, if we focus on “marginal infrastructure” meaning the stuff that’s already being purchased, the average TCO is already almost two-thirds opex. By 2020 it will be three-quarters. Worst of all, the high-level services or service features have the highest opex contribution to TCO.
Ironically, Cisco has all the right DNA to be a leader in service automation. From the very early days of DevOps, they favored a declarative model rather than a script-based approach, for example. It’s my view that it’s impossible to do effective and flexible service automation any other way. Cisco’s current approach, which is a policy-based declarative model, isn’t how I’d approach the problem (nor is it how I have approached it in past NFV work) but it’s at least compatible with SDN and legacy infrastructure. Its failure lies in the fact that it’s not really addressing operational orchestration.
Which is where I think the brass ring is. If you think about service automation, you realize that a “service” is a kind of two-headed beast, one representing the technical fulfillment and the other representing the business process coordination. While it may be possible to automate technical tasks, it will be difficult to do that effectively if you don’t collaterally automate the service processes that deliver everything to the user and manage billing, etc. You have to collaterally virtualize management to manage virtualization, in any form.
That’s the other point here. We have ignored operations for the cloud just as fervently as we’ve ignored it for NFV and SDN. Cloud services can’t squander resources to minimize faults and still be profitable, any more than you can do that with networking.
So here’s the challenge that Chuck Robbins faces. Can you take Cisco’s decent-but-disconnected-and-incomplete story on service automation and turn it into something that addresses SDN, NFV, and the cloud. If so, and if you kind of hand this area over to the UCS people, you have a shot at being what Chambers wanted Cisco to be—the number one IT company—and also attain a top spot in the network space. Otherwise, you’re delaying a reckoning that will be only harder to deal with down the line.