Tag Archive for Cloud

Whats Up With Cisco?

Whats Up With Cisco?What is up with Cisco? Their fiscal results for the recently closed 2017 Q3 showed revenue of $11.9 billion, a 1% decline in revenue, compared to the same quarter last year. This is the 6th consecutive down quarter. The networking goliath also issued downward guidance for 2017 Q4. They estimated a revenue declines of 4-6% year-over year.

Cisco logoOn the earnings call, Cisco CEO Chuck Robbins blamed several factors for the lower guidance. He cited:

  • “a pretty significant stall right now” in the U.S. federal public sector
  • Service provider revenues were down in Mexico.
  • United Kingdom business is being dampened by currency issues.
  • Middle East, there is “pressure… relative to oil prices.”

Then there are the layoffs. Cisco buried the announcement in a footnote in the company’s SEC 8-K report that 1,100 more layoffs are coming, on top of the 5,500 announced Layoffsin August 2016.

In May 2017, we extended the restructuring plan to include an additional 1,100 employees with $150 million of estimated additional pretax charges.

According to SDXCentral, the Cisco CEO stressed several times on the earnings call, that the company is transitioning to more software and subscription-based business. He declared,

I am pleased with the progress we are making on the multi-year transformation of our business.

These weak fiscal results and the move to a subscription-based business have led to speculation about what the Cisco business will look like in the future. TechTarget speculates that Cisco may go so far as to separate the Network Operating System (NOS) from the hardware. They contend that such a move would be a dramatic departure from Cisco’s traditional business model of bundling high-margin hardware with its NOS. The author believes that market trends will likely force the vendor to release an open NOS.

Cisco Catalyst 3750-E.TechTarget cites reports from the The Information that a hardware-independent NOS called Lindt is coming. Reportedly Lindt will run on a white box powered by merchant silicon. According to the article, a number of market trends are driving the move to a hardware-independent NOS.

The first market trend forcing Cisco to release a hardware-independent NOS is the company’s declining dominance of the Ethernet switch market. Since 2011, the company’s share has dropped from about 75% to less than 60% last year, according to the financial research site Trefis. The decline is important to Cisco’s bottom line because switches accounted for 40% of Cisco’s product sales in 2016, 30% of net revenues and 20% of the company’s $162 billion valuation, Trefis reported.

Infrastructure as a ServiceCisco’s weakening performance in switching is tied to the second market trend forcing Cisco to release a hardware-independent NOS. It’s customers are turning to public cloud providers, such as Amazon (AMZN) Web Services, Microsoft (MSFT) Azure and IBM (IBM) SoftLayer, for their IT infrastructure. The more enterprises subscribe to infrastructure as a service, the less networking gear they need in their data centers.

The shift to cloud providers is found in the latest numbers from Synergy Research Group. Revenue from public cloud infrastructure services is growing at almost 50% a year. In the fourth quarter of last year, revenues topped $7 billion.

Cloud providersThe third market trend forcing Cisco to release a hardware-independent NOS is the trend where enterprises that were Cisco’s largest customers are joining cloud providers in building open networking hardware and software to replace inflexible proprietary systems that lock them to a vendor. Those companies include large financial institutions, like Bank of America, Goldman Sachs and Fidelity Investments, and communication service providers, such as AT&T (T), Deutsche Telekom and Verizon (VZ).

The technology shift is driving an enormous amount of spending on IT infrastructure. Worldwide spending on public and private cloud environments will increase 15% this year from 2016 to $42 billion, according to IDC. Meanwhile, spending in Cisco’s core market of traditional infrastructure for noncloud data centers will fall by 5%.

Arista NetworksWhile Cisco is ignoring the trend away from proprietary hardware, the article says Cisco’s rivals are embracing it. Juniper Networks (JNPR) and Arista Networks (ANET) have released a version of their NOS for white boxes favored by cloud providers and large enterprises. Both companies reported year-to-year revenue growth in switching last year. Even Cisco’s patent lawsuit against upstart Arista was set-back by the courts.

Rohit Mehra, an analyst at IDC hypothesized that Cisco’s resistance to change is likely due to fear that giving customers other hardware options would accelerate declining sales in switching. “There would be potentially some risk of cannibalization in the enterprise space,” he added.

Cisco insists its customers are not interested in buying networking software that’s separate from the underlying switch. The Cisco spokesperson told TechTarget:

Cisco insists its customers are not interested

The vast majority of our customers see tremendous value in the power and efficiency of Cisco’s integrated network platforms, and the tight integration of hardware and software will continue to be the basis of the networking solutions we offer our customers

TechTarget adds that Cisco doesn’t say the article is wrong. Instead, the company falls back on a corporate cliché for refusing to discuss a media report. “We don’t comment on rumor or speculation,” a Cisco spokesperson said.

The networking market is evolving away from the hardware that Cisco depends on for much of its valuation. Cisco will resist changing its market approach for as long as possible. But in the end, the company will have to become a part of the trend with an open NOS capable of running on whatever hardware the customer chooses.

Mergers and acquisitionsRather than change its model for selling networking gear, Cisco has spent billions of dollars on acquisitions over the last few years to create software and subscription-based businesses in security and analytics. But Cisco’s software push has yet to pay off with 5 conservative down quarters.

Finally, Cisco just recently patched a flaw in IOS software that affected more than 300 models of its switches. Despite issuing an advisory on March 17, Cisco did not release the patch for this vulnerability until May 8, 2017. The Cisco vulnerability was part of the Vault 7 WikiLeaks dump of alleged CIA hacking tools.

Alleged CIA hacking toolsThe vulnerability, rated a critical 9.8 out of 10 by the Common Vulnerability Scoring System, is in the Cluster Management Protocol, or CMP. could allow a remote, unauthenticated attacker to reload devices or execute code with elevated privileges. This vulnerability can be exploited during Telnet session negotiation over either IPv4 or IPv6.

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Ralph Bach has blogged from his Bach Seat about IT, careers and anything else that catches his attention since 2005. You can follow me at Facebook and Twitter. Email the Bach Seat here.

Avaya Goes Chapter 11

Avaya Goes Chapter 11-Updated- 03-07-17 As predicted Avaya spun off its networking business. The lucky winner is Extreme. The presser from Extreme is here.

In one of the worst kept secrets in tech, Avaya has finally declared bankruptcy. The Santa Clara, CA-based communications company filed for chapter 11 protection on January 19th 2017 in the U.S. Bankruptcy Court for the Southern District of New York. Reports are that Avaya faced an end of January deadline to reach agreements with creditors to address its $6.3 billion debt or potentially default.

Avaya Goes Chapter 11The company’s presser announcing the bankruptcy characterizes the decision to seek Chapter 11 as a necessary re-do on deals made a decade ago. The company was spun off from Lucent, a former AT&T unit, in 2000. Avaya went private in 2007 when private equity firms Silver Lake Partners and the Texas Pacific Group took over the firm for $8.2 billion. Avaya was set up as a leveraged buyout – loaded with debt. At the time the new owners said going private would help Avaya to accelerate product development. In 2009 Avaya scooped up the remnants of Nortel for $900m.

The Nortel acquisition added Ethernet switching and VoIP to Avaya’s portfolio. While the move added needed hardware to the Avaya portfolio the rest of the tech world started the shift towards software-as-a-service and the cloud. Avaya was not able to digest Nortel while taking on Cisco, Microsoft and the cloud at the same time.

$6.3 billion debtAvaya was both late with VoIP and Unified Communications. Neither Microsoft nor Cisco were competitors in the TDM/PBX era. Cisco joined the race with VoIP and Microsoft then came along with Unified Communications. Both have tremendous enterprise penetration and brand recognition.

The pressure forced Avaya to consider selling it’s crown jewel, its contact center products to Genesys in 2016, in the hope it would raise some cash. When the deal with Genesys fell through, Avaya decided to file for bankruptcy. Avaya CEO Kevin Kennedy said in a statement, “…chapter 11 is the best path forward at this time.

In order to keep the lights on during the reorganization, the company has secured a $725 million loan underwritten by Citibank.

As part of its debt load, Avaya owes its pensioners $1.7 billion unfunded pension liabilities. According to NoJitter Avaya will honor it obligations to maintain and continue the pension (as did GM in its reorganization).

Chapter 11 only impacts Avaya’s United States operations. In the rest of the world the company is moving to assure customers and stakeholders that it’s business as usual.

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My experience is that the Avaya IP Office product is way over-priced, even in a bid environment. Why would anyone buy an Avaya Ethernet switch or access point when you can get a Cisco or an HP?

So what is to become of Avaya? One likely case is that all of business units will be sold off to satisfy the creditors. The only thing left of Avaya will be a service organization to care for the huge installed base of orphaned Nortel and Avaya systems.

I know people are already getting calls from Cisco about replacing Avaya.

Ralph Bach has been in IT for fifteen years and has blogged from his Bach Seat about IT, careers and anything else that catches his attention since 2005. You can follow me at Facebook and Twitter. Email the Bach Seat here.

The Enemy Within

The Enemy WithinNaked Security reports on a hack that combines two of our favorite things on the Bach Seat, Florida and lax data security in schools. The way the Sophos blog tells the story, a 14-year-old Florida boy is charged with trespassing on his school’s computer system after he shoulder-surfed a teacher typing in his password, used it without permission to trespass in the network, and tried to embarrass a teacher he doesn’t like by swapping his desktop wallpaper with an image of two men kissing.

Insider threatThe author cites a Tampa Bay Times report which says that an eighth-grader was recently arrested for “an offense against a computer system and unauthorized access”, which is a felony. Sheriff Chris Nocco said that the teen logged onto the network of a Pasco County School District school using an administrative-level password without permission.

In fact, a spokesman for the Pasco County Sheriff’s Office told Network World that the student was not detained. Rather, he was questioned at the school before being released to his mother. His sentence remains to be seen, but at this point, it’s looking like the boy isn’t going to suffer much more than a 10-day school suspension and what sheriff’s detective Anthony Bossone says is likely to be “pretrial intervention” by a judge with regards to the felony charge, the Tampa Bay Times reports. Naked Security says this is the student’s second offense.

Old school network securityWhen the newspaper interviewed the student at home, he said that he’s not the only one who uses that password. Other students commonly log into the administrative account to screen-share with their friends, he said. It’s a well-known trick, the student said, since the password was a snap to remember: it’s just the teacher’s last name, which the boy says he learned by watching the teacher type it in.

The sheriff says that the student didn’t just access the teacher’s computer to pull his wallpaper prank. He also reportedly accessed a computer with sensitive data – the state’s standardized tests (now we know why he is in trouble – NCLB! – Common Core!!while logged in as an administrator. Those are files he well could have viewed or tampered with, though he denies having done so. Sheriff Nocco says that’s the reason why this can’t be dismissed as being just a bit of fun. Even though some might say this is just a teenage prank, who knows what this teenager might have done.

I logged out of that computer and logged into a different one and I logged into a teacher’s computer who I didn’t like and tried putting inappropriate pictures onto his computer to annoy him.

in typical HS-er logic, he told the newspaper:

If they’d have notified me it was illegal, I wouldn’t have done it in the first place. But all they said was ‘You shouldn’t be doing that.

DDos attackAnother report from the other side of the continent comes from Engadget which reports that a teenager from Idaho took advantage of the latest trend in online criminal activity and likely rented a cloud based botnet to launch a distributed denial of service (DDos) against the largest school district in Idaho. The alleged DDoS took down the school district’s internet access according to media reports.

KTVB News reports that the 17-year-old student paid a third-party to conduct a distributed denial of service attack that forced the entire West Ada school district offline. The act disrupted more than 50 schools, bringing everything from payroll to standardized tests (More high stakes testing – NCLB! Common Core!!) grinding to a halt. Unfortunate students undertaking the Idaho Standard Achievement test had to go through the process multiple times because the system kept losing their work and results.

BotnetThe report goes on to say that authorities have found the Eagle High student from their IP address, and could now face State and Federal felony charges. If found guilty, the unnamed individual is likely to serve up to 180 days in jail, as well as being expelled from school. In addition, the suspect’s parents will be asked to pay for the financial losses suffered as a consequence of the attack.

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Many school networks have bigger pipes than the business world. Some EDU networks I have worked on have had 10 GigE for years. In the rest of the online world, these incidents would serve as a wake-up call to network managers that hey, we might be at risk too, but not schools. Oh yeah – Passwords are Evil

Rightly or wrongly schools rely on the Intertubes for instruction, their core-business and NCLB high-stakes testing, but they take no steps to protect themselves. Administrators fight common tactics like periodic password changes, enforcing password complexity or blacklisting common weak passwords. None both with an anti-DDOS strategy let alone buying a tool to fight off a denial of service attack.

Ralph Bach has blogged from his Bach Seat about IT, careers and anything else that catches his attention since 2005. You can follow me at Facebook and Twitter. Email the Bach Seat here.

BYOD Obsoletes PBX

BYOD Obsoletes PBXFierceMobileIT noted a new study from RingCentral, a provider of cloud business communications systems, which claims BYOD is now threatening the traditional business phone systems. The survey of 309 professionals within organizations who make purchasing decisions on phone systems found that personal mobile devices are so prevalent in the workplace that they are rendering traditional business phone systems obsolete.

cloud business communications systemsAccording to FierceMobileIT, the survey’s key findings:

  • Half of respondents use mobile phones even while sitting at their desk, with a traditional desk phone in front of them
  • 88 percent of employees use their mobile phones for work purposes while on personal time, including evenings, breaks, weekends and vacations
  • 70 percent of respondents believe office phones will eventually be replaced by mobile phone – Millennial workers are especially likely to believe this is true

RingCentral President David Berman told the author he believes that the new wave of employee owned mobile devices are better than a premise based phone system.

Mobile devicesMobile devices are turning into true business tools and are transforming the workplace as a whole, from shifting traditional business hours to changing how employees interact via voice, video, text and other business applications. We believe that all these changes are making legacy on-premise phone systems obsolete as they do not meet modern business needs

Praful Shah, RingCentral’s VP of strategy, told FierceMobileIT that his firm has seen a “tremendous behavior change going on with BYOD.” Asked what stood out in the research to him, he says it was the degree to which employees are using their personal devices to do work. He assumed the practice to be popular, but not to the degree the survey revealed. VP Shah noted;

Eighty-eight percent of employees are using mobile phones in their personal time for work. That is a phenomenally high percentage

Traditional business phone systemsThe result is a shift in what physical telephones organizations will  need to purchase. But it will also impact the need to provide applications that enable the employee to use multiple email and telephone accounts on the device, to keep private life and professional life separate when necessary.

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This study is from a firm who sells a competitive product to on-premise PBX, so they are spreading FUD for their benefit. Firms considering cloud based services should do due-diligence and question how these could based service providers are going to protect their data from government spying or it disappearing with little or not notice.

Additionally firm needs to protect its own data. They need a way to protect their data on an employees phone. That could include the ability for to completely wipe the firms and the users data from the phone.  I wrote about how BYOD can land an employee in jail here.

 

Employees Cutting the Corporate Cord With Smartphones: Infographic

 

 

Ralph Bach has been in IT for fifteen years and has blogged from his Bach Seat about IT, careers and anything else that catches his attention since 2005. You can follow me at Facebook and Twitter. Email the Bach Seat here.

 

 

Is Your Data Safe From Gen Y?

Is Your Data Safe From Gen Y? Fortinet (FTNT) released a new study which says that most Gen Y staff members are thwarting their employers Bring Your Own Device programs. Fortinet surveyed 3,200 employees between the ages of 21 and 32 on their attitudes and practices around BYOD and found that 51 percent of respondents said they would ignore formal BYOD policies at their organization.  “It’s worrying to see policy contravention so high …” Fortinet VP of Marketing John Maddison said in the study report.

 Gen Y The same Fortinet survey revealed that 55 percent said they have been the victims of cyber attacks on their desktops or laptops. The respondents noted that those attacks had affected their productivity and potentially cost them corporate or personal data.

FierceCIO provides another example of staff’s cavalier attitude towards data security from Symantec. According to the Mountain View, CA based Symantec (SYMC) when it comes to corporate data, employees who feel like they live in a “finder’s keepers” environment, Robert Hamilton, Symantec director of information risk management said. The firm surveyed workers in the U.S. about taking corporate data outside of the workplace, if they would use company information in another job and their views on whether that constituted stealing. FierceCIO reports the results of the survey, were not encouraging to IT security professionals and IT management:

  • Data theft40 percent of employees download work files to personal devices
  • 40 percent of employees plan to use old company information in a new job role
  • 56 percent of employees do not believe it is a crime to use a competitor’s trade secrets
  • 68 percent of employees say their company doesn’t take proper steps to protect sensitive information

Mr. Hamilton summarized, “The attitude is that ownership lies with the person that created it, not with the company that employs them.” He says companies need to do a better job of safeguarding data from employees, especially with the growing popularity of BYOD. Symantec noted,

Only 38 percent of employees say their managers view data protection as a business priority, and 51 percent think it is acceptable to take corporate data because their company does not strictly enforce policies

File-sharing servicesA survey by mobile file-sharing app provider Workshare provides more evidence of how employees flaunt IT policies by using free file-sharing services to store and share corporate documents from their mobile devices. FierceMobileIT reports that the firm’s survey revealed that 81 percent of employees access work documents from their mobile devices. A disturbing 72 percent of workers are using free file-sharing services without authorization from their IT departments.

Fiberlink recently conducted a survey of its customers about what apps they are blacklisting and whitelisting. DropBox appeared at the top of the blacklisted apps lists for both Android and iOS devices. Commenting on the results, Fiberlink CEO Christopher Clark told FierceMobileIT: “I think there are other ways besides DropBox or Box to do apps and content management.”

Personal USB devicesAnother survey, conducted by Ipsos MORI for Huddle found that 91 percent of U.S. office workers store work documents on personal devices, such as USB drives and 38 percent store documents on consumer file-sharing services.

FierceMobileIT reports that Dropbox is the most used consumer file-sharing service for work document storage and sharing.

Patrice Perche, Fortinet’s senior VP for international sales and support, said in the report:

This year’s research reveals the issues faced by organizations when attempting to enforce policies around BYOD, cloud application usage, and soon the adoption of new connected technologies. The study highlights the greater challenge IT managers face when it comes to knowing where corporate data resides and how it is being accessed.

FierceMobileIT’s warns that enterprises need to educate their employees to combat the security risks of using consumer file-sharing services. He also says that employers need to offer enterprise-sanctioned file-sharing alternatives. Otherwise, employees will continue to bypass IT policies and put corporate data at risk.

Symantec’s Hamilton told FierceCIO that firms need to undergo a cultural shift if they are going to win the battle of protecting their assets from their own staff.
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Sharon Nelson at Ride the Lighting sums up my thoughts on the BYOD thing.

I have never understood the arrogance of this attitude or the failure to appreciate that employers have a duty to impose rules in order to protect client/customer/proprietary data./proprietary data.

It is common for each succeeding generation to despair of the generation that follows it, but I confess to a certain amount of despair for a generation that is so tied to their mobile devices that they cannot balance their desire to use their devices with the duty owed to the employer to keep work data secure. In a world where young folks cannot seem to keep from checking their phones at weddings and funerals, I guess it is no wonder that they see nothing wrong with willfully disobeying rules imposed at work.

What do you think? Is your data safe from Gen Y staff?

 

Ralph Bach has been in IT for fifteen years and has blogged from his Bach Seat about IT, careers and anything else that catches his attention since 2005. You can follow me at Facebook and Twitter. Email the Bach Seat here.