Tag Archive for Switch

| August 15, 2020
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Can Cisco be XaaS-y ?

tech prognosticatorIt’s not news that these are unprecedented times. No one has seen anything like COVID-19 — or the global response to the virus – before. Many people worry about how this situation will evolve and how it will affect economies, careers, and personal bottom lines. The long-term economic fallout after the crisis passes is unknown. It’s possible it will be bad and last a couple of years. It may be shorter. There’s no way to tell. 

Can Cisco be XaaS-y ?The tightening of the purse strings has led tech prognosticator IDC to lower its 2020 guess forecast for the Ethernet switch and wireless LAN markets. The research firm expects the WLAN market to grow less than 1% from 2019, while the switch market will shrink 0.7%. The revised numbers represent a 3.7% point drop from IDC’s earlier 2020 forecast for Ethernet switches and a 4.8% point decline for WLAN revenue. In dollar terms, IDC says the switch market will reach $28.5 billion this year while WLAN revenue will be $6.2 billion.

To prove IDC’s point, Cisco (CSCO) just announced its ’20Q4 earnings report and it was not pretty. During the fourth fiscal quarter that ended June 30, the tech giant‘s product revenue fell 13% year over year to $8.83 billion. After the presser, CSCO slid by more than 11% – the worst day since February 2011.

Cisco logoAs an answer to declining revenue Cisco CEO Chuck Robbins announced layoffs a restructuring plan was underway:

Over the next few quarters, we will be taking out over $1 billion on an annualized basis to reduce our cost structure.

The San Jose, CA-based company Cisco, which employees 75,000 people, worldwide, did not say how many employees would be laid off restructured going forward. Cisco has been laying off employees over the past few quarters. CEO Robbins said on the earnings call, that the COVID-19 pandemic has forced the company to “re-examine” its entire portfolio and nothing is off the table. 

LayoffsIn theory, Cisco is using the restructuring to accelerate its R&D to focus on delivering everything it can as a service as it transitions to generating more of its revenues from software rather than hardware. In the last quarter, FierceTelecom reports that Cisco now generates half its revenue from software and services.

CRN reports that Cisco‘s infrastructure segment, which includes the core switching and routing businesses as well as wireless and data center products, continued its double-digit decline, falling 16% during the quarter to $6.62 billion. Overall, this segment dropped 10% for the full year.

Revenue was down across all customer and geographic segments. In terms of customer segments, Cisco saw revenue decline in all segments:

  • Public sector fell by 1%,
  • Service provider down 5%.
  • Enterprise declined 7%,
  • Commercial tumbled 23%,

Regional sales also fell:

  • EMEA fell by 6%,
  • APJC was down 7%, and
  • Americas, declined by 12%, 

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Besides COVID, other factors have stopped tech spending including technology shifts into 5G cellular networks, 400-gigabit Ethernet, WiFi 6. The fact is that Cisco wants to transition the majority of its portfolio to an as-a-service consumption model. Cloud expansion could support Cisco’s business. BUT–  Cisco has never been a major player in the cloud. Their go to cloud story proves it

Cloud computingIn 2014, Cisco’s first cloud strategy, InterCloud based in OpenStack was abandoned in 2016. Cisco’s next cloud strategy was to become the Switzerland of the cloud. This strategy was to work across multiple public and private cloud environments – to be a neutral player. It focused on: management, security, analytics,  and being Cisco – advanced networking. This Cisco Cloud phase has morphed again.

Cisco’s current approach to multi-cloud is network-centric and its centerpiece is an architecture called Application Centric Infrastructure (ACI) – which formerly only ran on Nexus devices. ACI focuses on policy, management, and operations for applications deployed across cloud environments. 

I’m sooo confused about the Cisco cloud story, are you?

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Stay safe out there!

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Ralph Bach has been in IT long enough to know better and has blogged from his Bach Seat about IT, careers, and anything else that catches his attention since 2005. You can follow him on LinkedIn, Facebook, and Twitter. Email the Bach Seat here.

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| February 24, 2018
Comments Off on Switch Sales Stalled

Switch Sales Stalled

Switch Sales StalledThe stats for sales of network switches are in for Q4 2017. Only one of the top 5 networking vendors was able to squeeze out a small gain in switch sales. The data comes from New York-based NPD. NPD tracks monthly network switch sales data from the sales channel, distributors, and resellers in North America.

The article on CRN notes that the total number of switches sold through the channel in the quarter was 514,095. The number is up slightly from 510,822 in the fourth quarter of 2016, according to NPD. Here are the five vendors that sold the most switches through the channel in the fourth quarter, according to NPD.

D-Link Systems

D-Link logoTaiwan-based D-Link Systems (2332:TT) sold 25,259 switches during the fourth quarter, according to NPD statistics. That total kept the company steady with the same period in 2016 when it sold 25,277. D-Link did not have a switch model among the top 10-selling units during the quarter. Its market share was unchanged at 4.9%, CRN said.

TP-Link switch sales

According to NPD’s data, of all the five best-selling switch brands, TP-Link saw the steepest decline during this period. The company based in Shenzhen, China sold 26,023 switches in Q4 ’17 compared with 29,798 in Q4 ’16. That’s a 12.7 percent year-over-year decrease. There is one bright spot for the firm, the article reports that the company’s TLSF1005D Ethernet switch was the third-best-selling unit during the quarter. But that was not enough to prevent a market share decline from 5.8 percent in 2016 to 5.1 percent in 2017.

Hewlett Packard Enterprise switch sales

HPE LogoThe news from NDP is not good for former networking giant Hewlett Packard Enterprise (HPE) either. The Palo Alto, CA-based firm saw a 1.8 percent decline in switches sold from 55,923 in Q4 ’16 to 54,941 switches in Q4 ’17. The quarter’s total was enough for a 10.7 percent market share, down slightly from the year-ago period. No HPE switch models were among the top 10 for the quarter, according to NPD.

Netgear sales

CRN reports that sales also slipped for Netgear. The number 2 switch company saw its market share dip from 18.3% to 17.9% year over year. The California-based firm sold 92,274 switches through the channel in the fourth quarter, down slightly from the 93,531 it sold in the same period a year ago, NPD said. Netgear had four switches in the top 10-best-selling switches during the quarter, including the top two models, the FS105 and GS105NA five-port models.

Cisco switch sales

Cisco (CSCO) was able to hold on to the #1 switch vendor position according to NDP. It sold 225,051 units during the period, a 5.7 percent increase that boosted the company’s market share to 43.8 percent from 41.7 a year earlier. Six of the top 10 best-selling switches in the quarter were Cisco Catalyst‘s led by the WS-C2960X 24– and 48-port models.

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What happened to the network switch market? It’s still reeling from the 2007/08 recession and the Wi-Fi takeoff. Other than the Cisco switches, most of the top switch models sold were unmanaged, desktop switches limited to 100 Mbps uplinks. These types of switches make it OK to randomly add an unauthorized switch at the desktop and POOF there does your data. These desktop switches with their limited feature set don’t include Spanning Tree, so users can create a network loop and take down the whole network segment.

Not much to shout about.

Where are the vendors? Brocade? Extreme? Juniper? Dell? I am old enough to remember when switch manufacturers had a #2 strategy. 3Com, Lucent, Bay/Nortel all came into my office and said they wanted to #2 – now they are gone.

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Ralph Bach has been in IT long enough to know better and has blogged from his Bach Seat about IT, careers, and anything else that catches his attention since 2005. You can follow him on LinkedIn, Facebook, and Twitter. Email the Bach Seat here.

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| June 20, 2017
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Whats Up With Cisco?

Whats Up With Cisco?What is up with Cisco? Their fiscal results for 2017 Q3 showed revenue of $11.9 billion, a 1% decline in revenue, compared to 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.”

Cisco layoffs

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. That is on top of the 5,500 announced in 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.

Cisco layoffs

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 financial results and the move to a subscription-based business have fed speculation about the future Cisco business model. TechTarget speculates that Cisco may go so far as to separate the Network Operating System (NOS) from the hardware. They contend the 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.

Open NOS

Cisco 3750 switchTechTarget cites reports from 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’s hand is the company’s declining dominance of the Ethernet switch market. Since 2011, the company’s share has dropped from 75% to less than 60% last year, according to the financial research site Trefis. The decline is important to Cisco’s bottom line. Switches accounted for 40% of Cisco’s product sales in 2016, 30% of net revenues, and 20% of the company’s $162 billion valuation.

Infrastructure as a ServiceCisco’s weakening performance in switching is tied to the second market trend forcing Cisco to release a hardware-independent NOS. Its customers are turning to public cloud providers, 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.

Cloud computing

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 providers are building open networking hardware and softwareThe third market trend forcing Cisco to a hardware-independent NOS is enterprises that were Cisco’s largest customers are now competitors. Enterprises and cloud providers are building open networking hardware and software to replace inflexible proprietary systems that lock them in. Those companies include large financial institutions, like Bank of America, Goldman Sachs, and Fidelity Investments. As well as communication service providers, 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 non-cloud data centers will fall by 5%.

White boxes

Arista NetworksWhile Cisco is ignoring the trend away from proprietary hardware, the article says Cisco’s rivals are embracing it. Juniper (JNPR) and Arista (ANET) have released versions 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:

TCisco insists its customers are not interestedhe 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.

Cisco’s own problems

Rather 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 been in IT long enough to know better and has blogged from his Bach Seat about IT, careers, and anything else that catches his attention since 2005. You can follow him on LinkedIn, Facebook, and Twitter. Email the Bach Seat here.

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| September 12, 2013
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PoE Overworked

PoE OverworkedGary Audin at No Jitter warns that Power over Ethernet (PoE) is not always a plug-and-play environment and PoE should be monitored, managed, and efficient. In this article, Mr. Audin observes that PoE has evolved into an electrical power device utility platform. POE started out as a centralized power source for IP phones, backed up with an Uninterruptible Power Supply (UPS). (rb- Click here and here for my overview of PoE) Since those early Cisco dominated days. The article says PoE now is called upon to support wireless access points; environmental controls; point, tilt, and zoom cameras; lighting control; clocks; door controls; Bluetooth devices; RFID; now laptops, and still more to come.

The LAN switch is the PoE source, but the article warns it can be overwhelmed with the power drain, which produces headaches for IT. Unless properly managed, the PoE function can experience:

  • power drainA blown-out power supply. Smoke is an indicator of this condition.
  • Reduced power to all devices with degraded service from all the attached devices.
  • An added PoE device does not work.
  • The more power is drawn by PoE, the shorter the UPS battery life. The original UPS design could last 20 minutes. Added PoE devices could shorten this to 3 minutes.

PoE IP phones and other devices can signal to the PoE network what class of device it belongs to and how much power it may need. Class 0 devices, usually older devices, do not indicate their PoE power requirements. These devices may draw any power level from none to maximum. The other standard classes, 1-3, range from very low power to mid-level power consumption.

Class 4 is a newer class of device requiring PoE+ (802.1at) and needs to draw more than the 12.95 Watt maximum provided by the original standard PoE. Class 4 devices must be powered by PoE+ ports and may not function correctly on an 802.3af PoE port. Most IP phones are in class 2. IP phones with color screens and other advanced features may be categorized as class 3 devices.

PoE classes

PoE Access Points Wireless LAN access points are also common PoE devices, many of which started out as class 2 and 3 devices. As the wireless speeds increased, so did the power requirements. The 802.11ac standard means that the access points (AP) will have a 1 Gbps connection back to the switches and routers.

site-surveyAt issue is the PoE required. It is likely that each AP could need 20 to 30 watts, the limit that the 802.1at PoE+ standard delivers. Many installed switches cannot support PoE+. So the enterprise has to buy new switches or power supplies or power injectors. (rb- add this to your site-survey when you plan to implement 802.11ac)

Mr. Audin spoke to Tim Titus, CTO, and founder of PathSolutions, (they happen to sell a network management tool) about what he considers a good approach to monitoring and managing POE. He told No Jitter,

“Regardless of whether there are any PoE or PoE+ devices on a network, it can be very helpful to monitor the health of our network equipment’s power supplies. The best monitoring system watches the status and power consumption of each power supply, what percentage of utilization it is running, and which interfaces are drawing power, so power policing can be achieved.”

He provided this example of missing power management.

“Keeping an eye on power supplies avoids unpleasant discoveries. One unlucky network administrator had two power supplies installed in a network chassis (one primary and one backup). Unfortunately, when the primary power supply stopped working, nobody knew, since the backup power supply was doing its job of keeping everything running. The problem wasn’t noticed for over six months. Nobody was in the empty remote wiring closet to notice the lack of lights on the power supply. The users remained blissfully unaware of impending doom until the wee hours of a weekend when the second power supply was shut off by a circuit-breaker trip!” 

Mr. Titus pointed out to Mr. Audin, that monitoring should happen at the port level,

“Not only will a monitoring system show you what mode a PoE port is operating in, but it should also provide a view of relevant error counters.

  • MPS Absent and Invalid Signature errors frequently point to broken or defective powered devices.
  • Overload conditions and short-circuits typically point to wiring problems (or somebody re-wiring devices in use).
  • Denied errors can point to devices asking for more power than the switch has available, and may indicate that it is time to consider adding another power supply to a large Ethernet chassis.”

How did that happen?

Finally, many network engineers try to buy limited PoE due to the cost premium of POE ports, only to find that half of their PoE ports are used by non-PoE devices such as PCs. With a monitoring tool, the engineers could have avoided buying expensive PoE ports or purchased less expensive “ordinary” Ethernet ports.  The engineers should have an up-to-date PoE port inventory and use it to avoid over-buying the PoE by playing safe in their design. (rb- Been there done that, I’ve been in many customer’s closets and found POE switches full of PC and printer access ports.)

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The author warns not to assume that PoE is always a plug-and-play environment. PoE should be handled like a utility–monitored, managed, and efficient.

I have tried to build custom fields by working with reports in SolarWind’s Orion by working with MIBs, it’s not the funnest thing in the world. I wonder if this product does a better job.

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Ralph Bach has been in IT long enough to know better and has blogged from his Bach Seat about IT, careers, and anything else that catches his attention since 2005. You can follow him on LinkedIn, Facebook, and Twitter. Email the Bach Seat here.

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| July 29, 2010
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Intel Shows TBps Connections

Intel Shows TBps ConnectionsThe EETimes reports that researchers at Intel Corp. (INTC) have demonstrated optical chips can transmit up to terabit-per-second of data transmission. The new silicon photonic chips will replace copper connections in everything from supercomputers to servers to PCs chips predicts Intel. The new chips can currently transmit data at 50 Gigabits per second (Gbps). 50 Gbps equates to transferring an HD movie a second.

“This milestone marks the beginning of silicon photonics in the high-volume marketplace, in applications from [high-performance computing] all the way down to the client PC,” said Mario Paniccia, director of Intel’s Photonics Technology Lab. “We see a clear development path from 50 Gbps today to a terabit in the future,” Mr. Paniccia told EETimes.

Intel says that optical connections could eventually replace the copper connections between systems and even between boards in the same system and down to cores on the same board. intel’s Paniccia estimated that the first commercial applications of silicon photonics will begin appearing in as little as five years in data centers and supercomputer facilities.

The modulators required to encode optical information using signal waveguides and photodiodes are cast in silicon on custom chips designed by Intel. The transmitter chip uses Intel’s hybrid silicon laser technology that bonds a small indium phosphide die to on-chip silicon waveguides, four of which are patterned into a connected optical laser.  “We combined our silicon manufacturing techniques with our hybrid laser and demonstrated an integrated transmitter using four lasers each operating at a different wavelengths and four silicon modulators each operating at 12.5 Gbps, then combined them together into an aggregate 50 Gbps into the optical fiber,” said Paniccia.

The optical fiber output on the receiver chip is then filtered into separate colors and diverted by waveguides into four separate photodiodes, each of which receives one of the four separate 12.5-Gbps channels. In the future, Intel plans to add more lasers per chip and increase the number of channels. Intel believes that it can put 25 lasers on a single chip to produce the 1 Tbps capabilities. It then hopes to commercialize the optical connection technology.  Intel has been developing the technology since 2004.

Intel already has a 10-Gbps Light Peak chip that uses conventional optical technologies that are aimed at reducing the number of port connections on a computer. The Silicon Photonics Link is different from Light Peak technology. Intel’s Light Peak technology – an optical cable that is aimed at reducing the number of port connections on a computer. said it used traditional optical devices and scaling it beyond 10 Gbps speeds would be difficult.

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For some perspective, the 1 terabit per second link could transfer the entire printed collection of the Library of Congress in 1.5 minutes.

Intel is preaching high bandwidth and low cost with these chips. If Intel can deliver, it could change the nature of system design. Theoretically, these chips could allow system components to the spaced further apart without the performance hit. With these chips, data center expansion could be down the hall instead of a full re-design. Now it may be cheaper to take the new gear to the available electrical panel rather than adding a new panel to the server room.

Intel’s Paniccia told VentureBeat that the accuracy of the data transfer is superb. So far, it has been proven to be able to transfer data with no errors for 27 hours straight, which means it can transfer more than a petabyte of data without an error.

 

Ralph Bach has been in IT long enough to know better and has blogged from his Bach Seat about IT, careers, and anything else that catches his attention since 2005. You can follow him on LinkedIn, Facebook, and Twitter. Email the Bach Seat here.

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