Bernard,
CSCO has almost ZERO systems integrators.. they use partners such as KMPG and Andersen Consulting. Networking equipment may be commoditized in pockets - some fast than others - but by definition the value add will not be commoditized. Furthermore innovation in coupling applications and users (profiles) to network services will allow companies like CSCO, JNPR, FDRY, and others to continue create differentiation which is software based. Further to all of this is that networking hardware continues to be (and will be for the forseeable future) mission specific. That is an edge router for a small business will look distinctly different (different ports, speeds, redundancies, applications, etc.) than an enterprise router, than a enterprise switch, than a SP edge router than a core router, than a enterprise gateway, than a caching engine... etc...etc... The functions are quite different.
That is to say you can't make a motocycle out of a car or a moped out of a motorboat. Yes they all are forms of transportation and they all have an engine but that's about as far as the simliarities go. The competition - differentiation - still is resident with the manufacturers of the items of transportation in question. So, looking at the network processor; it, by itself will not usher in a commoditization of networking and fwiw there is no evidence, real or implied that the network process has done ANYTHING to commoditize the networking market to date - other than at the extreme where the issues are most cost driven than performance. The point - broadly positioned network processors are not useful for high end mission specific applications because they can not perform as well as mission specific designed ASIC's and associated architectures. And price does not matter here as much... And silicon manufactures aren't going to start a fab unless the volumes are there and the volumes simply arent' there for the high end mission specific network elements.
But then, Gilder has already explained all this to you before.... I'm sure.
OG |
