Dealing with the classic Catalyst 6500 end-of-life

Network managers who have relied on the classic Cisco Catalyst 6500 platform in their data center and campus networks are approaching a crossroads: the Catalyst 6503, 6506 and 6509 platforms will reach end-of-life in November, which means Cisco will cease offering hardware support. Cisco will also stop selling the classic Catalyst 6513 in November, ending hardware support in August 2017.

Cisco offers a couple of migration options for customers facing classic Catalyst 6500 end-of-life. In the campus LAN, users can invest in the newer Catalyst 6500-E platform, which got a new lease on life with the release of the Supervisor Engine 2T. Meanwhile Cisco recommends that customers with the classic chassis in their data centers migrate to the Nexus line.

Catalyst 6500 end-of-life: Core migration is a headache

Catalyst customers are more concerned with a rip-and-replace at the core than in the wiring closet. Migration is somewhat simple in the wiring closet, while at the core it's much more radical.

“Replacing a core is not a trivial event. The hardware is cheap, but swapping out that hardware is an expensive proposition from an outage perspective, from a time perspective, and [in terms of] configuration validation,” said Forrest Schroth, network manager with staffing firm Randstad. “I would rather an upgrade at the core layer be a [result] of me needing functions that [the classic Catalyst 6500] doesn’t support rather than a vendor trying to push me new products.”

For many customers, the classic Catalyst is still sufficiently meeting their needs in the core.

“If you still have Catalyst 6500s around, they’ve been running in a fairly stable state for a while and most folks out there are going to continue running them as they stand. They understand that [the Catalyst 6500s] have limited functionality, but they are put in places in the network where [users] are not worried about a lot of forward evolution in terms of functionality,” said Eric Hanselman, research director with the 451 Group.

Even those that want to make change in the data center don't love the fact that Cisco is pushing them toward the Nexus line. In a newer data center, Schroth installed Catalyst 6500-Es in his core rather than migrating to the Nexus line.

“We were going back and forth because there are features we don’t need [in Nexus] and features we would lose going to Nexus,” Schroth said.

Can you avoid a Catalyst 6500 end-of-life?

As Cisco winds down the classic Catalyst 6500, network engineers can turn to after-market equipment specialists like Network Hardware Resale (NHR) that offer third-party support for the equipment. In fact, these companies see the Catalyst end-of-life as an opportunity.

Mike Lodato, senior vice president of sales and marketing at NHR, gives the example of one   healthcare organization with 385 classic Catalyst 6500s that was facing a $65 million migration bid from Cisco to the Catalyst 6500-E. The upgrade was driven by an upcoming rollout of voice over IP (VoIP) that would need the more robust Power-over-Ethernet capabilities of the Catalyst 6500-E. However, the VoIP rollout was a phased project with 85 sites in the first year, 120 in the second year and 92 in the third year. Rather than upgrade them all at once, the healthcare provider wanted a phased installation of the new switches, saving money by staggering the purchase, installation and support costs in time with the VoIP rollout. NHR was able to support that slow transition

“We came in and said, 'instead of converting them all before you need them, how much does it save you to put those on third-party support?'” Lodato said. “'How much can you save in capital and depreciation expense by deploying them at the time of business need rather than the time of vendor mandate?'”

NHR is also working with Matrix Telecom Inc. to maintain 18 classic Catalyst 6500s in its service provider network, according to the company’s manager of IP network services, who asked not to be identified. He  plans to keep the switches for as long as NHR can keep getting him replacement parts.

“As technology grows and evolves, we will need to upgrade them. Right now, my network is really stable. We’re not looking to do any major upgrades,” he said.

Other companies have been reluctant to use third-party support for network infrastructure because it is difficult to change course and get back on a Cisco support contract, Hanselman said. But with the classic Catalyst 6500, this worry is irrelevant. “Something bordering on antique becomes less of a concern,” he added.

Will Cisco stick to the Catalyst 6500 end-of-life dates?

Cisco has tried to retire elements of the Catalyst 6500 line in the past but has encountered pushback from customers. Some wonder if customer protest will stop this upcoming end-of-life.

“There are so many backbone nodes out there,” Schroth said. “[Customers] did not allow them to outdate CatOS, and they have not allowed them to remove the 6500 series. I believe this is more of a threat than an end-of-life. There is going to be a customer revolt and that date is going to slide.”

(Sources - http://searchnetworking.techtarget.com)

Microsoft Buys Skype for $8.5Bn…? But Wait, There’s More!

By Russell Bennett May 10, 2011

I admit that I was taken by surprise by this morning’s news that Microsoft had acquired 65% of Skype for $8.5 billion (yes, I wasn’t paying attention on Sunday when GigaOm got the scoop). After the Skype IPO was put on hold there had been lots of rumors of Cisco/Facebook/Google being in discussions to buy Skype but I never heard that Microsoft was interested (and that was part of their plan, since they agreed the purchase price over three weeks ago). However, now that I have woken up to this news, I think I have a perspective that most of the baffled financial/trade press have yet to latch on to.

The more I think about it, the more the voice of the late infomercial king, Billy Mays, keeps ringing in my head: “But wait, there’s more!”

So this deal makes perfect sense to me: let’s see if it makes sense to you. From Microsoft’s perspective, Skype has a number of interesting attributes:

• Brand
• Network - 170m users
• Technology: Voice, video, IM; all running in "the cloud"
• Synergies
• Worldwide PSTN origination and termination deals
• Competitive strategy benefits
• Intellectual Property portfolio
• Luxembourg domicile

Brand and Network

In the modern vernacular, Skype is a verb: that is evidence alone of the value of the brand. (I know that the marketing professionals are divided on whether this is a good thing for the brand or a bad thing for the trademark, but I will let them continue to battle that one out.) Skype also has 170m registered users; although claims of registration for a ‘free’ service don’t directly translate to revenue, this is not a small number. However, if you add in the following statistics you start to get a sense that the service is compelling:

• 40% year on year growth;
• 600k new users per day;
• 207bn minutes in 2010;
• 30m concurrent users;
• 40% of usage is video.

These statistics (which will have been audited by Microsoft, knowing what I do about their "CorpDev" group) mean that the business has face value, but is there hidden value? I think so, and here is why.

Technology

I said in my UC Cloud Implications paper that scale is going to become a problem with UC in the cloud; particularly the issue of latency and local network bandwidth at the data center. Skype’s peer-to-peer technology for voice, video and IM&P neatly addresses this by distributing the load to the clients (even better than SIP does), theoretically making consumer/SMB cloud UC infinitely scalable. If you combine Skype’s emerging SMB product (which was being developed by three former Microsoft executives and Jonathan Rosenberg) with the emerging Microsoft 365 cloud service, then you have a winner with cloud based UC. Since both Skype and Lync use wide-band and internet-glitch-resilient codecs, the call/video quality will be much better than you will be able to get on any other service.

Synergies

There are clearly synergies between the Skype consumer service and existing Microsoft offers: Lync, Outlook, Xbox Live, Windows phone, Windows Live, Bing/search, the list goes on. Lync, which already has multi-modal federation with the Windows Live community will get a massive lift by being able to offer UC connections between its enterprise customers directly with their value chain partners; this is huge in and of itself – I commented on this in my Federation paper last month. Clearly Avaya had this idea first in announcing its partnership with Skype last year while both companies were owned by Silver Lake; since that service has not yet shipped, it will be interesting to see if it will ever ship (see Competitive Strategy below).

A counter-intuitive synergy (for conventional thinkers), is the ability for Skype to ship on non-Microsoft platforms (Mac, Linux, Android, etc. even the ubiquitous home TV!…). In the press conference this morning, Steve Ballmer stated that Skype would continue to support non-Microsoft platforms (they would be silly not to, IMHO) but in the Q&A session he was challenged on this again. The ability for Microsoft to ship UC and other clients on popular platforms has always been a goal for Microsoft, but it was something that it a) wasn’t very good at and b) never got much help on from the platform owners (for obvious reasons). Buying the technology expertise and the business relationships to enable cross-platform support is critical for Microsoft’s future success. Furthermore, Microsoft’s dependence on Windows is something that draws heavy fire from industry analysts; so I am not sure why anyone would be incredulous about this part of the acquisition strategy.

PSTN Termination and Origination

Clearly, Skype has built and extensive list of PSTN origination and termination deals to support their Skype In/Skype Out service. As I said in the Cloud UC and Federation papers, Microsoft is arguably building an alternative (UC) communications network with Lync and Microsoft 365 and needs to build those service provider relationships itself while rapidly being perceived as a competitor by those same service providers. So gaining access to the Skype PSTN connectivity neatly solves both problems for Microsoft and is a major advancement of their cloud UC strategy.

Competitive Strategy

Clearly a big part of this deal for Microsoft was preventing Cisco/IBM/Avaya/Google/Facebook/whoever from acquiring Skype – the classic business school "double whammy." (Not to mention the threat of Skype for Enterprise becoming a UC cloud competitor.) Of these competitors, only Google already has a credible consumer VoIP service; and Facebook now has to spend money and, more importantly, time in building a real-time communications service to support its truly enormous and vibrant social network.

As mentioned above, there is the possibility that this deal will allow Microsoft to kill the Avaya/Skype federation deal that was agreed late last year. I am sure that Avaya had a contract for this and that Skype will be committed to deliver on it. If for no other reason, both Avaya and Skype are owned by Silver Lake and they wouldn’t sell Skype to Microsoft without ensuring that Avaya wasn’t harmed in so doing. Or would they? Maybe this was part of the deal and was reflected into the sale price: only time will tell. Without doubt, Microsoft will ensure that they delineate the Avaya federation to the Skype user community and will not allow Avaya users to federate with Xbox Live users, for example.

There is of course Skype as a stand-alone business and access to its user community is as coveted by other eCommerce ventures as it was by Microsoft; only now even more so. I predict that many online businesses will be doing deals to use the Skype network in future and that the Skype business unit’s stand-alone P&L will start to grow quite handily. Of course, this was the value that eBay saw in Skype in 2005, it’s just that they were not able to realize that value, for whatever reason.

[As a side note, the 35% that eBay retained in 2009 when they sold the majority stake to Silver Lake was then worth $1 billion, it is worth $4.6 billion just 18 months later. Although eBay took a $900 million write down on the Skype acquisition in 2007, that was just financial engineering. eBay’s sale of Skype to Silver Lake in 2009 valued the company at $2.9 billion, which is approximately what they paid for it. So that makes the net profit for eBay on Skype, at today’s price, $3.8 billion ($4.6bn+$1.9bn-$2.7bn), excluding the tax benefit of the write down. Meg Whitman took a lot of flak for the Skype purchase, but she has had the last laugh.]

Intellectual Property

Skype has 32 approved patents and 36 filed patents in the US on all manner of topics related to peer2peer and IP communications. Given, as I said above, that peer2peer communications solves all kinds of UC scaling issues, and given that patent lawsuits against Microsoft are never less than $1 billion in damages, the price tag for this acquisition could be justified on the intellectual property inventory alone.

Luxembourg domicile

It has been commented in the financial press that Microsoft can unfairly use part of its $40 billion overseas cash pile to pay for Skype in Luxembourg while "avoiding" paying US tax. I think that this is a fatuous argument: all corporations use overseas money to pay overseas bills, it is just common sense.

However, the real pearl in the oyster with regard to the Luxembourg domicile is potentially the ability of Microsoft to side-step any future national regulation on IP communications (see my Cloud UC paper on this topic). Clearly I am not professionally qualified to comment on international law or national regulatory jurisdiction, but it seems intuitive that regulation of a communications service that has an overseas corporate domicile (with a profoundly liberal business environment), not to mention a communications technology that doesn’t have any national physical premises, just got a lot more difficult. Having said that, the Chinese government "switched off" Skype in the PRC in January of this year; however, the Chinese are clearly willing to go that extra mile further than many other sovereign governments.

Summary

I think that there is a lot more to this deal than meets the eye and I give credit to the Microsoft leadership for pulling it off. Of course, there is a gap between plan and execution so this deal may not yield all of its intended benefits. With only a few hours’ notice, the pundits can be forgiven for questioning the $8.5 billion price tag just because it represents a 350% profit for Silver Lake (and partners) in just 18 months. However, Microsoft has had many months to consider all the angles and I suspect that they believe that they got a good deal.

According to the Gartner Magic Quadrant for UC for 2010, Microsoft was the leader in UC, followed closely by Cisco and Avaya. The 2011 Magic Quadrant will make very interesting reading.

(Source : http://www.ucstrategies.com)

Contrite Cisco Regroups Before Skeptical Wall Street

By VERNE G. KOPYTOFF

Published: May 8, 2011

SAN FRANCISCO — John T. Chambers, one of the best salesmen in Silicon Valley, has been having trouble selling anyone on his company’s future.

Cisco Systems, where he is chief executive, is in a slump. The management system he put in place slowed decision-making and innovation. The company’s growth has slowed and its profits are falling.

His latest sales pitch is that he can revive Cisco — a technology colossus that makes computer networking equipment — by pruning its sprawling business and refocusing on its strengths.

But investors, Wall Street analysts and customers are a little bit skeptical of Mr. Chambers’s promises. No major improvement in Cisco’s finances is expected when it reports third quarter earnings on Wednesday. Given Cisco’s size, the scope of the overhaul and the increasing competition that is eroding the company’s market share, a turnaround could take time.

Last week, Cisco said it would reduce bureaucracy by eliminating a crazy-quilt management structure that had executives responsible for geographic regions as well as serving on “councils” that were supposed to encourage cooperation between the different groups. Instead, it slowed decision-making.

Last month, Mr. Chambers, who declined to be interviewed for this article, took his first step to fix Cisco by suddenly shutting down its Flip video camera business. Only two years earlier, Cisco had acquired Flip’s parent company for $590 million to expand its nascent consumer products division. The camera was popular and, indeed, the company was days away from release of the latest version of the video camera.

“This isn’t simply a midcourse correction,” said Jeffrey Kvaal, an analyst with Barclays Capital. “They’re facing challenges that are multi-year.”

The doubt in Mr. Chambers’s sales pitch began last year when Cisco’s sales started to show weakness that Mr. Chambers initially attributed to the sour economy. When profits continued to wither quarter after quarter, Mr. Chambers alternately blamed a decline in government spending and a “transition” after the introduction of new switches for computer networks.

In the last 12 months, its shares have fallen 31 percent as the Nasdaq index gained 22 percent. While Cisco’s shares fell, those of its rivals like Juniper Networks rose 35 percent. Alcatel-Lucent’s shares doubled.

In April, in a memo to employees, Mr. Chambers acknowledged systematic problems at Cisco. He blamed slow decision-making and a lack of accountability. “We have disappointed our investors and we have confused our employees,” Mr. Chambers wrote. “Bottom line, we have lost some of the credibility that is foundational to Cisco’s success — and we must earn it back.”

The contrition is unusual for Mr. Chambers, who is known for his unwavering optimism during his 16 years leading Cisco. He has paused his cheerleading only once before — during the dot-com crash more than a decade ago, when Cisco was unprepared for customers sharply cutting back orders. Cisco had been one of the hottest companies of the Internet boom of the 1990s with a high-flying stock to match. Much of the blame for its shortcomings fell on Mr. Chambers, much as it does today.

The last few years should have been golden for Cisco. Telecommunications companies worldwide were rapidly expanding their infrastructure to accommodate growing traffic from online streaming and mobile phones.

But Cisco failed to keep pace with changes in the network switching and routing equipment, which accounts for nearly half its revenue. The industry has shifted from more standardized technology — a landscape in which Cisco thrived — to specialized equipment for various niche markets.

For example, Cisco’s market share in edge routers, used by Internet providers to route traffic near the edges of their networks, dropped 11 percentage points over three years to 42.2 percent in 2010, according to the Dell’Oro Group, a market research firm.

“They’ve been lagging,” said Shin Umeda, an analyst with the Dell’Oro Group. “As a result, the competitors have been able to move in.”

Rivals like Alcatel-Lucent and Juniper Networks grabbed market share from Cisco in edge routers. Meanwhile upstarts like F5, based in Seattle, have chipped away at Cisco in other specialized markets like the equipment for controlling the load on Web servers in data centers.

Analysts said Cisco stumbled because Mr. Chambers distracted the company by trying to push into new businesses like videoconferencing, smart meters for monitoring electricity use, television set-top boxes, video screens for stadiums and even a tablet computer for businesses. These initiatives, called “adjacencies” within the company, were supposed to be the foundation of future growth.

Some of them have gained momentum, like Cisco’s corporate voice-over-Internet telephone systems and WebEx, the business videoconferencing service it acquired four years ago. But others, like the consumer products and digital signs, failed to catch on or are so far afield from the company’s main focus that analysts say Cisco is better off without them.

In addition to cutting Flip, Cisco folded its Umi home videoconferencing into its business-oriented unit. Eos, a service for media and entertainment companies to manage online content, will most likely be discontinued as a stand-alone product or sold. So far, Cisco has cut 550 jobs, but it has also offered voluntary buyouts to some of its employees in the United States and Canada.

Despite Cisco’s troubles, the company remains a powerful force with $40 billion in annual revenue and nearly 73,000 employees.

Still, more reorganization at Cisco is expected. The Linksys unit, which sells routers for home networking, is among the most likely targets because of its lower profit margins, analysts said. Cisco is expected to pay closer attention to its main router and switching businesses.

In his memo, Mr. Chambers largely signaled as much by saying that Cisco will “compete to win in the core.”

He added that the company’s breadth of products gave it a big advantage.

However, achieving the long-term goals of up to 17 percent annual revenue growth is no easy feat for a company so big. Indeed, Mr. Kvaal, the Barclays analyst, said that he would be happy if Cisco simply shored up its business and kept up with the networking industry’s growth.

Sales of switches are expected to be flat this year, but grow 6 percent the following three years, according to the Dell’Oro Group. Router sales are supposed to grow 9 percent annually over that period.

“Cisco doesn’t have to be a market-share gainer, they just have to hold onto the share they have,” Mr. Kvaal said. “They have taken the first step, but it’s not the only step.”

(Reference - http://www.nytimes.com)

Among the VoIP Manufacturers

Avaya (www.avaya.com)

Avaya makes a wide variety of communications systems and software, including voice, converged voice and data, customer relationship management, messaging multiservice networking, and structured cabling products and services. According to Gartner, Avaya’s “status as a leader is in part based on the architecture of its Avaya MultiVantage Communications Applications suite, which emphasizes an extensive feature set, scalability, consistent user interface, call processing power, and investment protection.”

Cisco Systems (www.cisco.com)

Cisco Systems makes networking solutions and network hardware and software, including converging voice and data products. According to Gartner, Cisco has “leveraged its strength in large-scale LAN infrastructure markets to win mind share among early adopters of converged networks. Its dealers are extremely effective in selling IT organizations, where many traditional telephony vendors are gaining credibility.”

Alcatel (www.alcatel.com)

Alactel provides communications solutions to telecommunication carriers, Internet service providers, and enterprises. A publicly traded company with fifty-six thousand employees worldwide, Alcatel’s focus is the delivery of voice, data, and video applications to customers and employees. Their OmniPCX communications platform enables a company to selectively operate using traditional or IP telephony methods. The platform is capable of supporting hybrid operations as well.

Siemens (www.siemens.com)

Siemens is a publicly traded company that manufactures electronics and equipment for a range of industries, including information and communications, automation and control, power generation, transportation, medical, and lighting. They provide mobile communication and telephone communication systems to businesses and mobile phones and accessories to consumers. Siemens employs approximately seventy thousand people in the United States and four-hundred-thirty thousand worldwide, with global sales of more than $91 billion in 2004.

NEC (www.nec.com)

Founded in 1905, NEC makes products ranging from computer hardware and software to wireless and IP telephony systems. For the fiscal year ending March 2005, NEC recorded more than $624 million in revenue. They employ about one-hundred-fifty thousand people worldwide.

According to Gartner, “NEC’s portfolio offers various levels of converged IP capabilities, a multitude of features, scalability, and investment protection. Their platforms have an excellent reputation in the education, hospitality, and healthcare vertical markets, with attributes that can attract other organizations with distributed campus environments. NEC Unified Solutions strategy offers a menu of services that support the planning, implementation, network readiness and ongoing service needs of IP telephony.”

Yealink (www.yealink.com)

Yealink is professional designer and manufacturer of IP phones and video phones for the world-wide broadband telephony market. Yealink products are fully compatible with the SIP industry standard, and have broad interoperability with the major IP-PBX, softswitch and IMS on the market today. High-quality, easy to use and affordable price-are what Yealink strive all the time to meet.

Founded in 2001 in Xiamen, China, Yealink has 9 years VoIP experience and has been 100% focusing on VoIP products. Also the core team has 16 years experience in telephone. More than 60 R&D VoIP engineers prove the innovative strength of the company by developing new VoIP product and technology constantly. All of these guarantee and backup Yealink's possibility of constantly providing world-class IP phone and establish Yealink as one of the leading designers and manufactures.

Yealink phones are characterized by a large number of functions which simplify the businesses communication with high standard of security and can work seamlessly with a large number of compatible IP-PBX that support Session Initiation Protocol (SIP).

Yealink also distinguished itself by years of experience at tailoring up the customized needs of different levels of businesses to ensure Yealink's customers benefit from the interoperability and flexibility of the phones and from the compatibility of all kind of SIP-based telephone system.

Shoretel(www.shoretel.com)

Shoretel, founded in 1998, is a privately held company that is all about IP telephony. Their approach is to evaluate your network first before designing a solution. The idea here is to determine how ready you are first, before taking the step into VoIP convergence.

According to Gartner, Shoretel’s “product architecture gives organizations distributed call control across multiple locations through an IP backbone that supports the use of IP and analog telephones. This enables organizations to implement a converged network at their own pace.”

The unique advantage of Force10 Command Line Interface (CLI) that is nearly identical to Cisco’s

SAN JOSE, Calif., February 24, 2010 – Force10 Networks, Inc., the global technology leader that data centers, service providers and enterprises rely on when the network is their business, today announced an aggressive new promotion that incents HP resellers to continue to offer a standards-based alternative to Cisco. Resellers that want to offer best-of-breed Ethernet networking solutions from Force10 will receive an improved margin and a lower-priced competitive solution than a comparable Cisco 6500 configuration.

“We’ve seen ongoing channel disruption since Cisco introduced its Unified Computing System / blade server technology in 2009. It intensified this week with the announcement that Cisco will terminate its channel alliance with HP. We see a fast-emerging opportunity to build relationships with partners that now need an alternative to Cisco,” said Andrew Stewart, vice president, worldwide channels and sales operations at Force10 Networks.

Under the new program, Force10 will help resellers and distribution partners like Bell Micro, Tech Data and NHR to define attractive best-of-breed solutions geared for the data center, 10 Gigabit Ethernet (GbE) and video applications.

Force10’s high density and resilient Ethernet switching and routing solutions are standards-based and offer the unique advantage of Command Line Interface (CLI) that is nearly identical to Cisco’s, thereby enabling seamless insertion. Moreover, Force10’s power and cooling metrics are up to 80% lower than Cisco’s comparable products. Also, the total cost of ownership (TCO) of Force10’s non-blocking line-rate solutions offer significant savings, ranging from thousands to millions of dollars over typical depreciation schedules used by enterprises today.

Industry Transition Opportunity

Called the “C300 Play-to-Win,” the promotion is designed to exploit the large installed base of Cisco’s Catalyst 6509 chassis, which has now reached end of life. Under terms of the promotion that runs through the end of September 2010, Force10 will sell at a lower price its chassis-based C-Series C300 switch against any new Cisco 6500 Series chassis. Moreover, authorized reseller partners who generate more than $1 million in qualified C300 switch net sales to Force10 will receive an additional 10 percent cash rebate.

According to Force10, its C300 chassis solution surpasses the density and switching performance of the Catalyst 6509, supporting 384 line rate GbE ports and 64 line rate 10 GbE ports, in the same footprint as the Catalyst 4510R. The C300’s compact design allows customers to support more network capacity with less space while reducing cooling and power costs.

For Force10 authorized resellers who would like more information, please log in to our Partner Portal. If you are not a Force10 authorized reseller but would like to join, please register here.

About Force10 Networks

Force10 Networks is the global technology leader that data center, service provider and enterprise customers rely on when the network is their business. The company’s high performance solutions are designed to deliver new economics by virtualizing and automating Ethernet networks. Force10’s high density and resilient Ethernet switching and routing products increase network availability, agility and efficiency while reducing power and cooling costs. Force10 provides 24x7 service and support capabilities to its global customer base in more than 60 countries worldwide. For more information on Force10 Networks, please visit www.force10networks.com.

(Source : Force10 Networks: News: Press Releases)

Cisco and Teliti Collaborate on Green Data Center Model in Malaysia - MarketWatch

Unified and Energy-Efficient Data Centre Aims to Meet Future Demand

KUALA LUMPUR, MALAYSIA, Jul 01, 2010 (MARKETWIRE via COMTEX) -- Cisco today announced its collaboration toward a green data center with Teliti Datacenters (Teliti), a locally owned systems integrator, at the inaugural Cisco Summit Malaysia 2010. Under this collaboration, Cisco will share data center best practices and work with Teliti as it develops a business model for data center management and a governance structure that enables Teliti to achieve world-class standards for data centre infrastructure technology in Malaysia.

The state-of-the-art data center facility that Teliti intends to build with the help of Cisco will enable Teliti to host and provide a comprehensive portfolio of information technology (IT) solutions and services with lower energy consumption and less impact on the environment. The collaboration demonstrates a commitment by both companies to drive the adoption of green technology in line with Malaysia's ambition to reduce the country's carbon emissions by 40 percent by 2012. The 120,000-square-foot facility will be located at the Enstek high-technology business park, on the outskirts of Kuala Lumpur.

"The data centre is the heartbeat of any organization and also one of the biggest consumers of energy in the company. A 'green' data center will not only provide the organization with a strong strategic advantage with the new efficiencies it could generate but also help it align with the Malaysian government's environmental goals. Cisco's collaboration with Teliti is part of our contribution to this national agenda," said Anne Abraham, managing director of Cisco Malaysia, at the launch of Cisco Summit Malaysia 2010, where the collaboration was formalized.

Besides capitalizing on its strong systems integration expertise, Teliti stands to build on Cisco's next-generation data centre network architecture to create a unified, highly available and energy-efficient data centre. Some of the key services that will be provided include co-location, connectivity and hosted services, with a wide range of managed services such as security, disaster recovery and business continuity.

"Teliti's green data centre will be built in line with the Malaysian government's Green Building Index and allows us to rapidly capture the growing opportunities in today's marketplace as businesses are increasingly deploying IT services to reduce capital expenditure, optimize operating expenses, and fulfill their environmental responsibility. Working with the global leader in networking technologies helps establish the competitiveness we need in delivering excellent services and support to all our customers, both local and international. We believe that our collaboration with Cisco will appeal to businesses, particularly the multinationals that need to comply with increasingly stringent environmental requirements. Our green data centre resonates well with the government's goal to position Malaysia as a regional IT hub and a top destination for foreign investment," said Tuan Haji Mohamed Nasir Abdul Majid, Managing Director, Teliti Computers.

Cisco Services helps businesses realize the full value of IT investments by aligning technology with their business strategy to capitalize on market transitions, support business transformation, and accelerate growth. Services also prepare the infrastructure so organizations can take advantage of the technical advances that enable competitive differentiation and advantage.

"Our role is to help Teliti quickly achieve its objectives while mitigating the risk of a brand-new infrastructure. This collaboration provides an opportunity for Cisco Services to expand our horizons in Malaysia, seeing that more and more companies are beginning to prioritize IT initiatives that allow their organizations to scale up to speed," said Steven Weeks, vice president, Cisco Services Asia Pacific.

This green data centre incorporates a reliable and fully redundant power supply to enable 99.999 percent uptime to all equipment, and smart cooling systems to suit the local climate. The building sports an environmentally friendly exterior, and utilizes solar energy and rainwater harvesting into its day-to-day operations.

The initial development phase of the first 45,000 square feet is targeted for completion by December 2011 and is expected to achieve an overall 30 to 40 percent reduction in carbon emissions. Teliti is also planning to extend its services reach into the regional market, targeting Singapore, Thailand and Hong Kong, when the green data centre is fully operational. Cisco will work with a rich ecosystem of partners to deliver these solutions and technologies to Teliti.

The collaboration towards a transformational data center with Teliti reaffirms Cisco's commitment to providing businesses in Malaysia with access to technologies and solutions that provide better integration between people, knowledge and ideas anytime and anywhere. These technologies include collaboration, borderless networks, video and virtualization tools.

About Cisco, the worldwide leader in networking that transforms how people connect, communicate and collaborate, this year celebrates 25 years of technology innovation, operational excellence and corporate social responsibility. Information about Cisco can be found at http://www.cisco.com. For ongoing news, please go to http://newsroom.cisco.com. Cisco products are supplied in Malaysia by Cisco Systems International, BV, a wholly owned subsidiary of Cisco Systems, Inc.

Cisco, the Cisco logo and Cisco Systems are registered trademarks or trademarks of Cisco Systems, Inc. and/or its affiliates in the United States and certain other countries. All other trademarks mentioned in this document are the property of their respective owners. The use of the word partner does not imply a partnership relationship between Cisco and any other company. This document is Cisco Public Information.

(Source - Cisco and Teliti Collaborate on Green Data Center Model in Malaysia - MarketWatch)

Cisco supply chain problems persist, prompting even longer backorders

Two words of advice for enterprises planning to refresh their network hardware -- order early! There seems to be no end in sight to the string of backorders Cisco Systems has issued over the past year for some of its most popular networking gear, apparently caused by ongoing problems in the Cisco supply chain.

"Customers are asking us, 'Hey, what's the deal with the product? When can we expect delivery?' The distributors don't really tell us anything [either]," said Chris Church, technical services manager for a Cisco partner in the Midwest, which he declined to identify. "You finally reach a point where you want to stop giving people dates because you're concerned about whether or not [they're] going to be met."

Since January, Church has seen long lead times for most of Cisco's Adaptive Security Appliance (ASA) firewalls. Four- to six-week shipping estimates issued earlier this year have since jumped to six or seven months. His usual contacts at Cisco have been vague as to the cause of, or remedy for, the delays.

"For pretty much every model except the very top-end one, which is the 5580, we were seeing very long lead times on them, and it hasn't gotten any better. If anything, it's gotten worse," said Church, who recently wrote about his Cisco supply chain woes on his blog, Layer 3, eliciting similar gripes from readers, one of whom reported a nine-month delay for ASAs.

"At first, they were saying March or April, and now they're saying June or July," he added. "Now, I'm starting to see some backorders on some of the [ISR] 2900 series routers that you might use to fill the role that a medium-range ASA might fill. It's starting to be a little bit of a ripple effect."

Speaking on the condition of anonymity, one network engineer at a large U.S. enterprise that is a devout Cisco customer said he has experienced backlogs as long as 150 days for Catalyst 2960 switches from direct Cisco purchases, as well as used equipment from various resellers.

Customers have turned to used networking gear vendors like Network Hardware Resale for some of Cisco's most high-volume products, complaining of "notorious" wait times reaching up to five or six months for new ASA firewalls and 2960s, according to Chris Stone, NHR's mergers and acquisitions manager.

Although the reseller gets its supply from enterprises unloading surplus networking equipment, the massive shortages throughout the Cisco supply chain are eating away at NHR's inventory, Stone said. In some rare cases, he said, the flood of demand is forcing NHR to reduce its large, hallmark discounts as supply dwindles.

"[The difference is] we're shipping in 24 hours for the most difficult products to find," Stone said. "It's either six months [from Cisco] or 'I can have this tomorrow.'"

Meanwhile, some networking pros are taking things into their own hands. Matt Simmons, IT infrastructure manager at Golf Savings Bank in Mountlake Terrace, Wash., balked at what now seems like a comparatively short three- to four-week shipping delay on three ISR 2600 routers. Cisco told him the problem was a software issue, he said.

"I thought it was really bizarre, so we bought these routers from [reseller] CDW and said, 'Why don't we buy the one that'll get here in a week? And I'll install the images myself,'" Simmons said.

Component shortages may not abate soon in Cisco supply chain

Although Cisco representatives declined to comment for this story, the networking giant cautioned investors about the problem in its fourth-quarter report for 2009.

"We have experienced component shortages in the past," the company stated. "We may in the future experience a shortage of certain component parts as a result of our own manufacturing issues, manufacturing issues at our suppliers or contract manufacturers, capacity problems experienced by our suppliers or contract manufacturers, or strong demand in the industry for those parts."

Citing an improving economy, Cisco attributed shipping delays in the first and second fiscal quarters of 2010 to increased demand as well as labor "constraints" in the Cisco supply chain.

"There can be no assurance that we will not encounter these problems in the future," Cisco stated. "Although in many cases we use standard parts and components for our products, certain components are presently available only from a single source or limited sources, and a global economic downturn and related market uncertainty could negatively impact [their] availability."

It will probably take "a couple quarters" for suppliers to catch up, according to Zeus Kerravala, distinguished research fellow at Yankee Group. Even the gray market, such as eBay, is drying up as demand floods it, he said. Smaller value-added resellers (VARs) are also hurting.

"If you're dealing with a small local VAR who's your buddy, he's not going to have the purchasing power of a [reseller like] CDW," Kerravala said. "Even if Cisco does have product, they're going to prioritize."

Cisco's supply chain appears to be hit harder than competitors'

Networking vendors across the market have been singing the supply chain blues for the past year -- at the mercy of component manufacturers, Kerravala said. But the Cisco supply chain seems to be suffering most, he added, and is more noticeable because of its large installed base.

"I'm not sure where exactly in the supply chain the problem is, but it looks like some of the components used to make some of the high-performance interfaces -- gig and 10-gig connectors -- are where the delay is," Kerravala said. "From what I understand, it is a supply problem. It's not really from demand."

Compounding the problem is that some of the components that original equipment manufacturers (OEMs) rely on for networking gear are also being used in some consumer electronics, Kerravala said. Although Cisco leads in enterprise networking, the supply chain gets better volume from consumer deals.

"If [a manufacturer's] choice is Cisco routers or mobile phones, the volume of mobile phones would be a hundred times what the volume would be for Cisco routers," Kerravala said, adding that he had heard of Juniper Networks experiencing supply chain backups. Juniper did not reply to a request for comment.

Parts shortages began for a host of OEMs for network equipment vendors in the second quarter of 2009, when component manufacturers had begun to scale down output, according to Loren Shalinsky, senior analyst at Dell'Oro Group Inc.

By fall, a wireless LAN (WLAN) chipset shortage left a number of vendors in limbo, including Cisco and Trapeze Networks. At the time, Aruba Networks attributed a shortage to increased demand and had delayed an announcement because of it. Aruba executives said the problem has since been resolved.

In January, Channel Insider reported that Cisco was still struggling to fill orders for core networking products owing to a shortage of the raw material used to manufacture semiconductors and other basic components of its switches and routers.

(Source - Cisco supply chain problems persist, prompting even longer backorders)