Question to the Thread: Does anybody know how long Cisco's telecom equipment will last? I mean how long before it is obsolete. Is it like PCs, which are obsolete in about 3-4 years, or is the lifespan much longer for some reason?
I think this is a relevant question, because of the argument that the telecom sector boom/bust is just like what happened to the railroad industry. That problem took a long, long time to correct. I don't think railroad tracks ever wear out, or if they do it must be a long time. Fiber in the ground may never wear out, but even that I heard could be technologically obsolete in a number of years. I am hoping that the railroad analogy is at least partly in error here, either on the basis of the lifespan of this equipment, or perhaps on the basis of the growth of the interet vs. the growth of railroad traffic (is the internet growing faster?). Below is a Washington Post article that makes the railroad analogy. The article seems a bit biased towards the negative, for example the statement about dark fiber in the ground implies that normally we would not have dark fiber. It makes economic sense of course to lay extra fiber, given the costs of digging up the ground.
Cisco is lucky in that they are seeing a rise in revenues from the enterprise side. I am also an investor in AMCC, who sells chips to Cisco for the telecom sector, and is therefore heavily affected by how long the bandwidth overcapacity lasts.
One last thing, is anybody here worried about Juniper's new router? It seems they have the performance advantage once again.
Thanks in advance for any replies.
John
washingtonpost.com
From the article:
"Telecom wouldn't be the first to go through such a boom-and-bust cycle. During the railroad boom of the late 1880s, so much money was invested building so many parallel tracks -- or tracks to places that would never support profitable service -- that the entire industry went bankrupt. Much the same story is told of the airline industry, which because of so many losing years has yet to turn a net profit." |
