Cisco AMPs Up Security From Datacenter To Endpoint
Nov10

Cisco AMPs Up Security From Datacenter To Endpoint

Having successfully targeted and gone on to dominate the networking and datacenter server markets, Cisco has set its sights on security, and from a new marketing slogan to its latest end-point protection product and pricing announcements, the company is committed to dominating this market too. “The two things that I think are going to be most important: Number one is security … and then moving fast in innovating over and over,” said Cisco CEO Chuck Robbins. Over the years, Cisco has mastered the art of using market transitions to capture share, and it appears it is well on its way to doing so in the security market, said Zeus Kerravala, founder and principal analyst of ZK Research. The market transition that’s changing security is digital transformation. Digital businesses need to move with speed and be agile, but they also must be secure, but the traditional security model in most companies doesn’t allow this, he noted. Earlier this year the company changed its brand promise to: ‘We securely connect everything to make anything possible.’ Robbins added “securely” to the sentence, and the security team is now involved in virtually everything Cisco does. Security-by-design is the standard, he said. With its primary revenue generator, networking, under attack, and a slowdown in its formerly high-flying UCS and HCI server sales, security has been a bright spot. “Cisco is making good progress and achieving strong results along the way,” blogged Jon Oltsik, Senior Principal Analyst and the founder of Enterprise Strategy Group’s cybersecurity service, and is executing accordingly to take their [along with IBM] cybersecurity businesses to $5 billion and beyond. The company’s security business is now at a $2 billion run rate, doubling its AMP for Endpoint customers from 8,000 in November 2015 to 17,000 as of August 2016. It was Cisco’s largest growth area (up 16% year over year) during its recent fiscal fourth quarter, to $540 million, the third straight quarter of double-digit revenue growth. This growth comes at a good time, because while spending may be inching upward when it comes to overall IT budgets, security is expected to grow at a compound annual growth rate of 8.3% through 2020, from $73.6 billion in 2016 to more than $100 billion. Other estimates put this year’s cybersecurity spend at $122.45 billion, and a 10.6% CAGR to $202.36 billion  by 2021. If the cybersecurity market has been looking good to Cisco, the endpoint security market, which is ripe for disruption, could be even more attractive. “In 2016, IDC expects security start-ups to continue to penetrate the enterprise endpoint security market segment as enterprises seek innovative solutions to detect ransomware and targeted...

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Cisco: On-Prem Storage 50% Better TCO Than Cloud

Cybersecurity may be Cisco’s current poster-child for revenue growth, but the company was also busy in the datacenter, with the launch of a storage-optimized server category, the UCS (Unified Computing System) S-Series. Designed to address the needs of data intensive workloads such as Big Data, and for deploying software-defined storage, object storage, and data protection solutions, Cisco is positioning its solution as ‘Data. Unstored.’ Less than 40% of stored enterprise data is ever used to create insight, but new applications such as video analytics, diagnostic imaging, streaming analytics, and machine learning demand and create data that is “un-stored” and actively processed in real time, states the company. It says traditional static IT infrastructure no longer works, while public cloud storage solutions can become expensive. The modular server, which features up to 600 terabytes of local storage in a 4-rack-unit (4RU) form factor, offers a number of benefits, including: -over 50% lower total cost of ownership (TCO) compared to public cloud (specifically Amazon Web Services); -reduces CapEx by up to 34%; -lowers ongoing management by up to 80%; -reduces cabling by up to 70%; -takes up to 60% less space; and, -consumes up to 59% less power. It’s easy to understand why Cisco might be interested in another server application. While server revenue declined 0.8% year over year, the public cloud services market is expected to grow 17.2% this year, to $208.6 billion, with the highest growth coming from cloud system infrastructure services (infrastructure as a service [IaaS]), which is projected to grow 42.8%. Data and business analytics (BDA) revenues will grow from $130.1 billion in 2016 to more than $203 billion in 2020, a compound annual growth rate of 11.7%. Amazon Web Services is the undisputed leader of public cloud services, with 45% of worldwide revenues, twice as much as Microsoft, Google and IBM combined. Together, the three competitors amount to less than 20% percent of infrastructure-as-a-service, or IaaS, revenues in Q3 2016. “There’s a perception that the cloud is not only faster, but also a lower cost versus on-premise and that’s just not the case,” said Todd Brannon, director of product marketing at Cisco. To house 420 TB of cloud storage for three years on Amazon Web Services’ Simple Storage Service (Amazon S3) costs around $550,000, compared with about $250,000 to house the data on the on-premise S-Series, Cisco said. In a one-on-one with IT Trends & Analysis Brannon said the modular approach will “allow customers to rightsize the infrastructure for the workload.” It’s less than half the price of public cloud, and provides “a completely modular platform approach to storage-optimized service.” Cisco is promising very attractive TCOs...

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Dell 3.0 Takes Center Stage at DEW

Austin, Texas:  The critical question arising from the inaugural Dell EMC World event — at least for me, an IBM, HP/E and Dell/EMC/VMware investor — is what makes Dell’s prospects any brighter than those of its two main competitors, IBM and HPE, and the trio of enterprise vendors offering more limited portfolios — Cisco, Oracle and Lenovo? IBM has seen its sales shrink for the last 17 quarters, HPE is just shrinking, and the other contenders can only offer partial solutions — predominantly networking and datacenter servers, DBMS software and appliances, and devices, respectively. From its humble roots in Michael Dell’s college dorm room, the company has scaled the PC heights, added servers, storage, software, networking, security and services and, with the completion of the EMC acquisition, is now grappling with the IT industry’s largest acquisition and largest debt load. It has also added significant resources in enterprise storage (disk, flash and software-defined), virtualization (VMware), cloud (Virtustream, Pivotal and ECS), networking (SDN/NSX), all-in-one appliances (VCE) and security (RSA). Of course there is a lot of overlap too, and while the combined companies may point out the differences, many others will be concerned about the similarities. We’ve already seen signs of tighter focus — i.e. the sales of the enterprise content division, services and software units, and the (lower-than-expected) SecureWorks IPO — and the first workforce reductions, 2,000-3,000 jobs are expected to be cut, out of 140,000. On the good (?) news front, Dell moved into top spot in server shipments for the most recent quarter, while HPE held on to top spot in revenues; shipments grew 2% year-over-year, while revenues edged 0.8% lower. Even better, EMC was named a leader in integrated systems, and the acquisition should strengthen that position, although Gartner cautions that uncertainty will plague the new Dell-EMC-VMware combination that brings ‘multiple overlapping and competing integrated system strategies under one roof.’ The results were equally ambivalent for enterprise storage, where revenue was flat while shipped capacities shot up 12.9%; EMC tied for first place with HPE ($1.6 billion each) while Dell came in third place with a revenue increase of 14%, up to $1 billion. Prior to the acquisition EMC was pushing a software-defined everything strategy, and it’s unlikely that focus will change under new ownership. The current evolution of IT is offering customers a couple of choices in pursuit of shrinking data centers, lower CAPEX and OPEX and the ability to leverage the cloud: some form of do it yourself versus an all-in-one solution, and hardware versus software lock-in (and that at the end of the day, there’s no getting away from software lock-in), Manuvir Das,...

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SDCU: Software Defined Cisco Unshackled
Oct12

SDCU: Software Defined Cisco Unshackled

Much like IBM, HP/E, Oracle and Dell, Cisco’s past — and a big slice of its current revenue pie — is based on proprietary hardware solutions that have made it an industry powerhouse for the last few decades. And much like its peers, it has seen the market move to non-proprietary and increasingly software-based solutions that cost less while providing customers with more agility and flexibility. The dilemma has been how to respond to market trends while keeping investors [including me] and analysts looking for higher sales and margins happy? IBM, which has sold off most of its hardware segments, outlasted HP to regain top spot in the IT vendor sweepstakes, but has recorded falling revenues for the last 17 consecutive quarters. HPE has been putting its enterprise house in order, but also spinning a lot of FUD about under-performing units and its future. Oracle’s hardware revenues dropped close to 20% last quarter. And Dell, which went private to get out of the quarterly anal probes also known as earnings/shareholders/analysts hell, bought EMC and while that could move it ahead of IBM, it could also cripple the company as it tries to manage the industry’s biggest merger, along with the biggest debt load. In its last quarter, reported in mid-August, Cisco had revenue growth of 2% and record non-GAAP EPS which grew 9%; for the fiscal year it had revenues of $48.7 billion, up 3%, and non-GAAP EPS grew 8%. “We had strong performance in security; data center switching, collaboration and services as well as continued success in the transition of our business model to software and subscriptions,” said CEO Chuck Robbins during the earnings call. Transition of our business model to software and subscriptions: the new Cisco intends to be very different from its proprietary hardware roots. Robbins said the product deferred revenue related to their recurring software and subscription businesses grew 33% in Q4. “Our momentum here is strong and we’ll continue to accelerate this transition.” At the same time it announced its Q4 and fiscal 2016 results, the company also announced it plans to lay off 5,500 employees [out of a total workforce of 70,000]. Margins in software services are higher than hardware because they bring recurring revenue and there are “fewer people involved on the cost side,” said Roger Kay, an analyst at Endpoint Technologies Associates. [IBM, HPE, Oracle, and Dell could be the next to shed workers, according to analysts.] In June IDC noted that Cisco’s networking stranglehold was continuing to loosen, down from 60.7% of the Ethernet switching market in 2015, and 61.8% in 2013. For the first quarter of 2016, Cisco saw...

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Cisco: Cloud Optimization A Big Problem, Bigger Opportunity
Sep21

Cisco: Cloud Optimization A Big Problem, Bigger Opportunity

A new Cisco-backed IDC study — Cloud Going Mainstream: All Are Trying, Some Are Benefiting; Few Are Maximing Value — reports that while the majority of the business world (68%, up 61% from 2015) is moving quickly to the cloud, only 3% are optimizing their cloud efforts, creating a services opportunity the networking giant wants to address. Cisco’s Business Cloud Advisor Adoption Report is intended to help organizations ‘determine their own cloud adoption level and associated business benefits relative to their industry peers—by industry, company size, and geography’; in addition, the company — and partners — is rolling out a new set of Cloud Professional Services. Based on primary market research conducted with executives responsible for IT decisions in over 6,100 organizations across 31 countries that are successfully implementing private, public and hybrid clouds in their IT environments, this is the most extensive cloud survey ever, said Fabio Gori, Senior Director and Head of Cisco Cloud Marketing (and double the size of last year’s inaugural study). He told IT Trends & Analysis that the fact that only 3% of customers in the world have strategized cloud in a strategic manner was a little surprising, but the biggest suprise was the “lack of alignment between IT and line of buisness”. While not a surprise, this IT/LOB culture clash is the biggest issue holding everything back, he said. “That misalignment is the number one reason why our clients are not being successful moving to the cloud.” That’s where BCA and Cisco’s cloud services can help customers accelerate and simplify their multicloud journey, said Cisco’s Erik Vogel, Senior Director, Advanced Services. [Multicloud was another important finding in the study: the 3% have embraced hybrid: 95% use private cloud, while 92% use public cloud.] In addition to IT/LOB misalignment, the other significant obstacles to achieving greater cloud maturity are the skills gap, and legacy siloed organizational structures, according to the survey. Another major challenge — like digitalization and analytics — is speed, added Vogel. “One of the key things client are telling us, we’re not fast enough.” So anything Cisco can do to help accelerate their journeyy to the cloud is a big benefit. “As this global cloud adoption study reveals, most organizations are still attempting to optimize their cloud strategies, but the 3 percent of organizations that have reached the highest level of adoption are reaping the most benefits,” said Robert Mahowald, Group VP, SaaS & Cloud SW, IDC, in a prepared statement. “It also underscores that multicloud environments are the default scenario among a majority of companies worldwide, and successfully managing multicloud is a key attribute of mature cloud strategies.” Much...

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