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Cisco gets aggressive on emerging technologies

The networking giant is ramping up its "emerging" technology plans, intending to release cutting-edge wares every few months for the next year.

LAS VEGAS -- Cisco Systems Inc. CEO John Chambers said his company is primed to begin what could be one of the most aggressive new product launch periods in its history.

During a Tuesday roundtable discussion with members of the media at the company's Networkers 2005 customer and partner conference, Chambers said the San Jose, Calif.-based vendor will release a new "emerging" technology every three to four months for the next year.

Cisco classifies an emerging technology as a brand new but significant initiative that has yet to be tied to the company's revenue projections, such as the application-oriented networking (AON) product strategy announced this week.

While he declined to offer specifics, he said upcoming emerging technologies would include those that focus on the data center in both physical and virtual capacities, and convergence products.

Chambers admitted that despite his company's success in recent years, the spate of emerging technologies is meant to correct strategic missteps made in years past.

"About two and a half years ago, we realized we weren't taking enough risks," Chambers said. He noted that Cisco's recent success in markets such as enterprise wireless, security and storage proved that the best approach is often an aggressive one, especially when a market is in transition.

Chambers said it typically takes between five and seven years for a product area to achieve an annual run rate of $1 billion, and the initiative is partially intended to incubate more product lines capable of achieving that mark.

Will Cisco augment its emerging technologies with more acquisitions? Most likely, said Charles Giancarlo, Cisco's chief technology officer. Giancarlo was quick to point out, however, that an acquisition isn't necessarily a sign that Cisco was slow to react to an emerging trend.

To the contrary, Giancarlo said the purchase of a smaller company often allows Cisco to gain the technology and people skills necessary to move into several markets faster than it could on its own.

Giancarlo said Cisco isn't afraid to use any resource at its disposal to innovate, because "Nobody gives you a prize for thinking about being first."

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Added Chambers, "I never move into a market without two [or] three acquisitions." He referenced the security market where Cisco has already acquired 14 companies, saying he wouldn't be surprised if several more security acquisitions were in the vendor's future.

Regarding the AON product line, Chambers said the new products increase the intelligence of the network so that it can assume many of the functions performed today by middleware.

Even though it will take time for partners and customers to get up to speed with the proper education and training, Giancarlo said Cisco is bullish on AON's potential.

"If we saw significant stumbling blocks outside of the traditional go-to-market challenges, we probably wouldn't be sitting here today," Giancarlo said. "We would have been much more cautious."

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