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Technology Stocks : Cisco Systems, Inc. (CSCO) -- Ignore unavailable to you. Want to Upgrade?

To: The Phoenix who wrote (13025)	3/22/1998 3:55:00 PM
From: Frank A. Coluccio	Respond to of 77400

Gary, a superb topping off to my post. Thanks. Far from my thinking that the Y2K issue is behind us, I reiterate that there are new (and sometimes cavernous) holes being found every day as we speak that need to be classified and resolved. Also, the status of compliance issues in this regard in the carrier sector has not been fully disclosed to the public yet (everything is extremely hush-hush there) and since much of the infrastructure and supporting operations support systems (OSSs) they use are their sole province, the general user community wouldn't necessarily know about such status until the vendors or the carriers are good and ready to disclose it, if ever. But enough said on that topic for now, I agree. Re: other contemporary market factors affecting uptake, let me point out one area that I feel is bound to have a profound impact on enterprise level purchasing (indeed, it is already starting to), and that is the outsourced Layer 3 VPN service environment. Suddenly we have the likes of Concentric, TCG/CerfNet, PSInet, etc., joined by the more traditional IXCs such as GTE Internetworking/BBN, ATT/VPN, MCI, and many others offering outsourced Layer Three services with latency guarantees, and SLAs with QoS promises. It's still too early for me to formulate an opinion if these services will prove to be enablers or inhibitors to vendor sales. [SIDEBAR: About a month ago I had TCG/CerfNet pitted against ATT/VPN. That was a short-lived strategy on my part, wasn't it? <g>] I am aware of at least three gargantuan deals in the making right now, two of them recently closed, that will effectively result in the supplanting of extant and otherwise planned-for infrastructure in some very large financials. Some of these were announced in the press very recently. The economies of scale offered by these carrier / ISP providers will be beneficial to those financial institutions and the carriers, at the expense, possibly, no, make that 'most likely,' of larger sales volumes extended by enterprises to the router & switch mfgrs. Something to seriously consider, IMO, as this market segment grows and evolves. It stands to reason that if Cisco and Ascend (and others in this ilk), say, succeed in blanketing the carriers with their wares for the purpose of those carriers extending outsourced Layer Three WAN services to their subscribers, then there will be that much less of a need by enterprises (who pay a higher premium, I might add) to secure their own network elements for the WAN. It goes back to the debate over choosing between public or private solutions. It seems to me that the pendulum continues to swing in the direction of public, which is not necessarily very good news for hardware vendors who have targeted the enterprise (as opposed to the pure-play carrier vendors). In some ways this boils down to the old question of "what do you want to be when you grow up?" I see this here, I see it in the VoIP market place, and I am beginning to see it in the schizophrenic johnny-come-lately-fiber-baron-inter-exchange-carrier-wannabe-wireless-clec-cable-operator space as well. It begs the question, then: "Is succeeding in the Carrier VPN Market by a major router vendor a form or self-cannibalization which will eventually prove to be nothing more than merely a Pyrrhic Victory?" Frank