Gary, you must be a propeller head (& I say that partly as a compliment but also partly as a criticism!).
No one is saying that a multi-purpose hardware platform is going to outperform a dedicated machine!
What we are saying (remember John Lennon?!!!) is that a routing functionality built into a multi-purpose hardware platform provides GOOD ENOUGH routing capability for the non-mission critical and non-fortune 100 companies who want to save 50% on purchasing their routers........in other words, what Nortel is doing is to create a developement environment where you will see a plethora of routers being developed on all kinds of "edge" appliances (cell phone, PC, fax machines, laptops, palmtops, set-tops, TV's, Sony playstation, etc.etc.) with some specializing in very basic routing capability at $500 a unit to go after the Small business market and some others developing niche vertical/horizontal and custom router applications.
Once the Genie is unleashed, products will follow and Cisco will be affected -- not in their current enterprise market but rest of the remaining small/mid size market. So this is a pre-emptive move by Nortel to prevent Cisco from gaining 70% monopoly market share on the next wave of IP adopters. Without the new growth from this smaller market segment, Cisco cannot continue to expand & justify their share valuation which they have been using to "buy" into the Carrier Class network equipment market (fortunately for Nortel & Lucent, it takes more than a product to win contracts from PTT's like implementation capability & even understanding how to deal with the beaurcracy/politics/foreign culture/relationship of PTT's from diverse markets around the world.
Nortel is attempting to cut this 900 pound data gorilla to size so they can't use funny money (stock) to push their way into the Public Network market.........and eventually in the long-term, true intelligence will likely reside in the Network as they become more sophisticated and complex.
In the long-run, router makers like Crisco will possibly go the way of specialized, proprietary technology companies like Wang, Lotus 1-2-3, Word Perfect, Novell, etc.etc. brought down to their knees by standards based network players. In that scenario, either Cisco becomes a custom router player or they have to sell to the PSTN network service providers!
It will be an interesting fight however.......like the upcoming Holyfield Lewis bout. |
