Cisco stakes out 30 markets for IP world domination
Zettabytes of cash to play with
Analysis In 2003, Cisco selected six key emerging markets on which to focus to drive growth and new revenue streams. Recently, it has increased that number to a huge 30, all unified by the common theme that they are driven by the explosion of data traffic over wired and wireless IP networks.
Cisco’s new markets
Last week Cisco CEO John Chambers told BusinessWeek  the company is using its $33bn cash mountain to “move with a speed nobody has ever attempted”.
Although the core business of IP infrastructure, particularly routers, remains the heart of the business – and strengthened by the move towards what Cisco calls the - zettabyte era of massive data and multimedia traffic – it has been working on the original six new directions (wireless, optical, home networking, storage networking, IP telephony, and security).
Wireless activities have included consolidation of its market lead in consumer and enterprise Wi-Fi; an intensified focus on selling IP core networks to 3G, 4G and converged carriers; moves into mobile broadband infrastructure through metro network and WiMAX projects; and even a possible shift towards a wider range of wireless IP end user devices, possibly including smartphones .
And behind all this, Cisco has moved into blade servers  and storage  to support two trends that will be important for boosting usage of the IP networks that are its lifeblood – and that will be key to mobile and converged operators too.
These are cloud services, where users' data and applications are held in huge central servers, possibly run by operators, and accessed securely over the internet; and the rise of machine-to-machine and “smart grid” applications, using IP and broadband-class connections rather than the traditional low speed, low power M2M systems.
US public utilities are leading the drive for smart grids and sparking a more general bubble of interest in M2M potential, as a way to increase efficiency in many industries, and to create a new revenue stream for carriers over whose wireless networks all that data could travel.
Chambers says smart grid could be a bigger market than the internet, whose infrastructure Cisco dominates, and could be worth $100bn in the medium term. The company outlined its strategy for the electricity grid, initially in the US, this week, covering routers to grid substations to home energy controllers, as the utilities look for a digital, IP-based upgrade with capabilities such as smart metering. Cisco estimates that the communications portion of that build-out will be worth $20bn a year over the next five years. Mobile operators are hoping for a substantial business too, in managing services for utilities and running smart grid apps on their networks.
Entertainment operating system
This is just one aspect of the new 30-point plan at Cisco. It is adding everything from video surveillance to home media systems to digital billboards – just about anything that can hang off an IP data pipe, and that preferably also incorporates one or more Cisco devices (putting videoconferencing in the Scientific Atlanta set-tops for instance).
"No other company touches the content, the carrier, and the consumer—and the best part is they all drive each other," BusinessWeek quotes Padmasree Warrior, Cisco's CTO.
Hosted services will be vital too – as well as enterprise and consumer cloud apps, Cisco is tapping into key trends like social networking, and in January pushed forward its vision of an integrated wireless internet/media solution for the home sector, with the launch of a hosted social networking platform based on its Eos (Entertainment Operating System).
This is typical of the type of integrated offering Cisco aims to create within its new business streams, and all tied into its IP networks. The social networks platform is designed to enable media and content companies to create and manage online communities via all kinds of devices from TVs to PCs to cellphones, harnessing the growing use of these services to promote their brands and drive usage of their services.
Eos promises a simple interface for content providers to build and personalize web sites, and technology to allow them to support interactive web services, so that fans can connect with musicians, television shows and games. It also promises to reduce piracy. It is the first major fruit of Cisco‘s Media Solutions business unit, created two years ago to push Cisco‘s cause in the digital media content sector.
Collaboration in Motion
Increasingly, all these devices and data types will travel over wireless as well as wireline networks and Cisco is looking to work more closely with new and established wireless carriers, as highlighted by its recent alliance with Clearwire. 
It is also stepping up the mobile content of its more traditional enterprise offerings, and this week announced the Collaboration in Motion initiative, which brings video and unified communications capabilities to mobile workers. As with most of its new activities, Cisco will combine various existing products and services – from its networking, WebEx and Unified Communications units – to form a new platform that delivers collaboration to notebooks and smartphones.
One of the first moves is the launch of WebEx for the iPhone. When Cisco acquired WebEx  in March 2007, it signalled a clear intent to take on Microsoft – and in future, potentially, Google – in the burgeoning enterprise market for unified communications (UC), supporting integrated messaging over wired and wireless networks, and using multiple formats from voice to email to IM to multimedia conferencing. Cisco believes the online collaboration software market will reach a value of $34bn, from an almost standing start, in 2013, as part of a broader expansion of converged UC in small and large companies.
The move to integrate all forms of messaging and mail, whether wired or wireless, within a common IP-based platform will not only enhance communications but underpin many new business processes and customer-facing activities for corporations, making it highly strategic.
Many companies will use steps towards UC as the foundation for broader moves towards mobile enterprise, all-IP convergence and Web 3.0 techniques, which over time will affect all their core applications and have the potential to revolutionize their businesses. In this scenario, the network and the application come together as never before, leading to a stand-off between those traditionally focused on the software - like Microsoft - and on the network, like Cisco.
This made the $3.2bn purchase of WebEx highly significant for Cisco, bringing not only web conferencing and collaboration tools, but the WebEx Media Tone Network, a global platform for secure delivery of on-demand applications; and WebOffice, which is similar to Microsoft‘s Office Live.
Collaboration in Motion builds on that, combining WebEx with Cisco‘s UC platform, Unified Wireless Network (and Advanced Services for technical support). The company says the project will bridge the gap between the wired, WLAN and cellular worlds, allowing mobile employees to work more seamlessly. It will also develop new applications for mobile devices as part of its Workspace Experience initiative. “Evolving modern businesses comprised of workspaces that are rarely physically connected, and critical business information is collected and shared with mobile devices, such as laptops and smartphones, “said Ray Smets, general manager for the Cisco Wireless Networking business unit, in a statement.
Other elements of the new move include an extension of the Compatible Extension Services Program to enable device manufacturers to chose the most relevant service for their particular product – sign-up has come from Wi-Fi chipmakers Atheros, Broadcom, Intel and Texas Instruments. Cisco is also incorporating high speed 802.11n Wi-Fi into a wider range of products and has announced the 5500 Series Wireless Controller, for improved performance in the delivery of video and rich media to wireless devices; and OfficeExtend, a wireless complement to the Virtual Office portfolio.
Cisco also is creating a developer program called the Cisco Developer Network to encourage partners to create software that takes advantage of Cisco‘s network platform. This includes a Developer Network Program for Mobility and offerings built through this community program are verified for integration with the Cisco Unified Wireless Network.
Copyright © 2009, Wireless Watch 
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