Cisco Dumps Monterey
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Cisco Systems Inc. (Nasdaq: CSCO - message board) will ditch the problem-prone optical switch that it acquired when it bought Monterey Networks in August of 1999, according to several sources in the optical networking industry.
They say that it plans to replace that device, called the ONS 15900 Wavelength Router, with a new switch that it’s developing in-house.
Light Reading has obtained information about the new device from five sources: two public equipment vendors, a startup switch manufacturer, a venture capital firm, and a market research company. All of them requested anonymity.
They say that the new product is being developed in San Jose by Cisco engineers under the code-name “The Manhattan Project” and that its official product name will be the ONS 15232.
It’s a 32-port OC192 switch, Light Reading’s sources say, and they add that Cisco is building the product using commercially available silicon, rather than custom ASICs.
One of the sources provided more detailed information, saying that the device will be able to optimize optical capacity by “grooming” traffic onto wavelengths at speeds as low as STS1 (51 Mbit/s). That’s significant because it will allow it to compete against products from Ciena Corp. (Nasdaq: CIEN - message board) and Sycamore Networks Inc. (Nasdaq: SCMR - message board), which support similar traffic grooming capabilities on their switches. Ciena’s current success is attributable in large part to being the first to support such a capability in its core optical switches.
Financial analysts were not surprised by news of the Monterey demise. “It wouldn't surprise me if it’s dead. Cisco has always been a vocal proponent of killing things that don’t work,” says Seth Spalding, analyst at Epoch Partners.
And the consensus among analysts is that the market would react positively to word that Cisco had a replacement switch in the works. “Is it better to have something rather than nothing? The answer to that question is pretty obvious,” says Alex Henderson, managing director and optical equipment analyst at Salomon Smith Barney.
Henderson adds that he will reserve final judgment on the merits of the new product until he has more details, but notes: “It sounds like it certainly has much better port density than the Monterey switch, and the fine grooming features could go a long way.”
Cisco’s attempts to ship its Monterey product have been plagued with problems, not the least of which is its size. While other optical switch companies have been trying to shrink their switches down into smaller form factors, Cisco’s 15900 is about the size of a Ford Expedition -- prompting one industry gag that “15900” is actually the product’s zip code.
“It’s been clear for almost a year that that [the Monterey switch] was not going to be successful. It had the wrong density, the wrong software interface, and it was too damn big,” says Henderson.
The company's aspirations for the device also suffered a blow when Monterey’s founders left to form the Iris Group, a startup coalition (see Iris Group Attracts $60M ).
In spite of all this, Cisco has adamantly stuck to its story that the product, while being delayed, would ship -- one day. It even went so far as to announce a customer for the product (see Cisco Plods Toward Optical Portfolio ), although it stopped short of claiming that the service provider had actually taken delivery of the switch.
Cisco declined to be interviewed for this story. “We don’t comment on unannounced products,” a spokesperson said.
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