CEO Blog

10 Reasons Why Cisco’s Unified Computing Strategy Will Get Push Back From Customers

Cisco’s so-called “Unified Computing” strategy holds vast and arguably adverse implications, as a way to lock customers into a proprietary world while locking out vendors like HP and IBM that are trusted open systems suppliers to enterprises around the world.  For the past few months, I’ve been pointing this out through my blog and various media outlets including The Wall Street Journal, Network World, and Investors Business Daily. Upon considering what’s known of Cisco’s “California” server, Unified Computing initiative and Unified Fabric architecture, I believe there are at least 10 good reasons why Cisco’s proprietary version of data center computing won’t fly.

1. Goliath vs. the world. Cisco may be on its way to discovering that it’s foolhardy to undermine the strengths of HP and IBM – companies that have tremendous relationships with data center customers, companies with a long history of driving costs out of the system and maximizing performance via balance between the components. It will likely take several generations for Cisco's “California” server to reach the product maturity of HP and IBM. These vendors enjoy long and deep relationships with Intel & AMD and can be expected to execute product refresh cycles more efficiently – at favorable pricing.

2. CIOs and IT managers won’t drink the Kool-Aid:  In today's frugal economy, CIOs and IT managers who are concerned with controlling cost of ownership are unlikely to rip out their existing data center infrastructures servers to enable Cisco to make its 60-70% gross margins.

3. Unified Computing means standards with a "C." According to Cisco, converged data and storage networking requires Cisco’s Data Center Ethernet (DCE), thus eliminating freedom of choice with a sole-source Cisco-only server and network. This puts at risk integration and interoperability with vast existing installations. The rest of the industry is working on an open approach called Converged Enhanced Ethernet (CEE) using IEEE’s Data Center Bridging (DCB) standards.

4. It's more about packaging than true innovation.  For example, Cisco's fabric extenders carry the same cost structure as switches, as they utilize similar switching silicon, physical interface components, and management processors.  When compared to traditional switches – sharing management via “stacking” – the fabric extenders are another example of packaging, not innovation.  The more costly data center infrastructure components – CPUs, RAM, and networking silicon – remain unchanged, except Cisco's prices are higher and – surprise, surprise – more Cisco gear is needed to control them.

5. Cisco: Looking for a few (thousand) good FEs. Cisco does not have the field people required to sell, configure, install or support servers or the applications. The non-hardware aspects of winning the data center are weighted heavily in the favor of the incumbents.

6. More I/O bandwidth-hungry VMs. A California server chassis, with eight powerful servers and large memory, only provides limited 10 Gigabit Ethernet links to the outside world.  Cisco’s is highly incented to make the I/O equation work by delivering additional I/O in the network, which means more yet more money for guess who? See Reason #10.

7. “Unified” is fine so long as you're only worried about the “unity” of one vendor’s gear. Cisco's "Unified Computing” blade server will use a PCI-Express connection that connects only to Cisco's Unified Fabric architecture. This promises to eliminate today’s freedom of choice in selecting different vendors and different transports such as standards-based FCoE, Fibre Channel or InfiniBand that can best suit a specific operating environment.

8.  In Cisco, we trust. The "Unified Computing" paradigm forces the customer to trust Cisco 100%, putting choice of technology, functionality pricing and at the whim of Cisco.

9. Back to the Future. Cisco's "Unified Computing" paradigm looks a lot like the old minicomputer days with single-vendor control and lock-ins. As we all learned in the 90’s, open standards promote innovation and keep prices low so you can select the best-of-breed solutions for your data center.

10. Follow the money – into Cisco's bank account.  Cisco's "California” server approach requires Cisco's Nexus 5000 switches that start at $17K for a bare-bones Layer 2 switch and significant premiums for adding Layer 3 and FCoE functionality, so the total cost of ownership will be similar to the cost of living in California.

So, I say once again to Cisco, welcome to your “California” server, now please go home.

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