I'm betting on CSCO for many reasons already mentioned. but here's one more I haven't heard, which has been gestating since hearing Chambers' comment about the partnership with LU not working out because of the differing corporate cultures:
Let us assume that both CSCO and LU must acquire or form close partnerships with companies in each other's domain to succeed.
Let us also assume that Chambers' comments that the cultures of the partners must be compatible in order for the union to succeed are accurate.
Now let's look at CSCO's likely success in building the necessary partnerships vs. LU's. Here's where my assumptions might not be as accurate, but here goes:
I am going to assume that LU is burdened by a "we know best" attitude, and that's what made the alliance attempts with CSCO fail. If that's true, I don't think an LU/ASND merger would go very well, for the same reasons. ASND is a proud bunch. If this whole next generation of products is a question of adapting voice for data or data for voice, there will be debates at every step, and neither side can afford to take the approach that "we know best". For the same reasons, I think a LU/Bay merger would struggle. So the only way LU can get into this new arena is by picking up companies so small (like Yurie) that they will be easy to swallow, but will have to patch several together to get an end-to-end solution. End result - LU is going to take a long time to get into data in a big way, and the game will be over by then. LU will be like IBM and AT&T, outrun by more nimble opponents, unable to broaden its scope, rather, slowly seeing its core businesses eroding.
CSCO, on the other hand, won't get into a partnership that doesn't work. This is perhaps one of Chambers' greatest strengths. They are dealing from a position of strength; NT, Alcatel, and the rest need CSCO just as much or more than CSCO needs them. Chambers will find a partnership that makes sense, and the end game will begin. CSCO may not ever be the firstest with the mostest, but they will have competitive products, and a superb marketing strategy, which emphasizes "partnerships" with the customers. In fact, if one wanted to summarize the secret of CSCO's success (perhaps someone has already done this, and if so, I apologize for plagiarizing), it is Chambers' vision to form partnerships - with acquisitions, with customers, and with employees. Like MSFT, it is not the best product that wins, but the way it is marketed. Unlike MSFT, Chambers has not done it arrogantly or by using intimidation, so this success story has a long way to run.
All my comments are from the outside looking in. My opinions in particular about the corporate cultures of the various companies may be wildly inaccurate, for which I apologize in advance if this turns out to be so. Thanks for the opportunity to get this particular set of thoughts down, though; comments???
Bob |
