Hi Gary,
I've been lurking here for a while, enjoying this dialog, and noticed that you've brought up the Y2K issue as a factor. I'd like to share some of my general observations on this topic, speaking in general terms, and _not_ focusing specifically on Cisco for the moment, if I may.
Your last message includes a widely accepted notion that:
>Another issue to consider is capital being spent on Y2K issues. This has been targeted as a reason for the modest slow down in networking expenditures.<
Although I've seen this general line of logic stated repeatedly here in SI and in other circles, I'm not so certain of this anymore, where the networking sector is concerned. My experience in consulting to major banks and brokerages just doesn't entirely bear it out. Granted, this was the scenario that was projected a year or two ago, when budgets were being banged out. At that time it was assumed that vendors would, by and large, be able to provide seamless upgrades to the majority of their network elements. But this form of solution has neither panned out entirely, nor is it in line with perhaps other strategic factors that IT departments face. In some instances, it merely accelerates a long awaited platform swap-out (under the guise of upgrade) that some faction always wanted, that much quicker.
In fact, the solutions to the Y2K matter may be starting to have a reverse effect. It's possible that I may be practicing in the wrong places to get a true perspective, i.e., the larger banks and brokerage houses, and in all fairness, these are not representative of the larger IT universe. But I can tell you what I'm seeing in these large user shops, and I tend to surmise that similar trends exist elsewhere.
I'm sure that there is a relationship between the momentary Y2K "distraction," as profound as it certainly is, and delays of new acquisitions of all types. Perhaps network equipment, though, has not been hit as hard from a volume purchasing perspective as other server/mainframe systems gear.
I don't mean to be minimizing the existence of gremlins in the networking sector; there are new hiding places being discovered every day, both in the carrier architectures where Bellcore and others are, ostensibly, getting a firm handle on the carriers' needs, and in private enterprise networks, as well (please, let's not get started on the ISP space!). But in the networking sector, the impact is not as straightforward in logic as that which is generally accepted. What I am now witnessing is possibly just the reverse (or at least a neutralizing effect) of this generally-accepted hypothesis, in terms of new capital outlays.
There are many existing network devices that meet the dual criteria of:
(1) inherently not being economically upgradable to Y2K compliance;
(2) nearing/surpassing their depreciation cycles, _and_ in need of compliance upgrade, as well.
In either case they must be replaced, immediately, meaning that new purchases must be made.
Also, in many cases new strategic initiatives absolutely must be executed in order to stay competitive, or gain competitive advantage, and so the show does go on. If the new initiative necessitates going with the next notch up in platform, or a newer, faster-cheaper-better hardware solution, sometimes this has the effect of a blanket upgrade, where spending is sometimes accelerated, perhaps in a seemingly premature, yet justifiable, way.
What I'm witnessing is either the purchasing of new compliant gear, or purchasing gear that is still non-compliant, but upgradable, providing that the vendor has a certifiable solution (facing very-sharp-teeth product- and service-level commitments) that is deployable through downloads by a certain date.
Of course, there are those overworked IT Departments in less affluent or more distressed organizations that simply cannot deal with, or afford, both sets of activities, and welcome the temporary reprieve they are getting, realizing the ability to catch up on backlogged projects while all this Y2K stuff settles itself. But I wouldn't bet on their being quite in a relaxed state. <grin>
Again, I may be suffering from myopia, playing in the wrong sand boxes, but I do not see any overwhelming proof at this time that Y2K is responsible for massive declines in new _network_ equipment acquisitions. Possibly just the reverse.
FWIW, and Best Regards,
Frank Coluccio |
