Comments re: Bert Hochfeld, Josephthal on CSCO/Cap Ex Issues
>>CSCO management pointed out that it is the voice and circuit technologies where there are business problems; capex and equipment to support growth of those networks is probably dropping quite rapidly. Capex to support data networking (which is what CSCO does)is continuing to rise at perhaps the same, or at a greater rate, than it has over the past few years.<<
Isn't this what the market is missing? Capex for next-gen network equipment has to keep rising, becuase that is where future growth and revenues will come from. Carriers must do this in order to remain competitive.
But I don't agree with the following.
>>For example, management pointed out they have the only VOIP offering, which is not a surprise given the nature of their competitors. In addition, they have a full line of products rather than point solutions.<<
Now this is just wrong. They may have acquired a full line of products, but they are certainly NOT the only VoIP offering on the market. There must be a half-dozen enterprise VoIP solutions available, and Sonus has the lead among service providers.
>>The way CSCO will deal with Juniper is not by internally developing a high-end switch router that's better.<<
Cisco's GSR group is certainly trying to do it internally, but based on what we have heard about their proposed Terabit System, they may not succeed.
>>What they will do is find another technology that leapfrogs Juniper. CSCO will either acquire the technology or acquire the company....<<
They have already acquired Growth Networks for that purpose, and Procket would also fit the bill.
But acquiring the company does not mean they can keep the talent.
Which raises an interesting question - is Cisco's core competency in router technology, or is it in acquiring other companies?
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