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Thursday, October 25, 2012

Cisco Systems faces threat to core router business

5:33 AM

Latest technology that helps direct the flow of information around data centers is becoming rising general in gear made by Cisco Systems Inc.'s CSCO -3.50% competitors, challenging the Silicon Valley pioneer's dominance in its core router-&-switch market.


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The idea, called software-defined networking, or SDN, permits companies to treat the mish-mash of tools that underpins their data centers as if they were a single, faultless system. Lots of products use a standard known as Open Flow, which analysts say could permit companies to purchase more basic routers & switches and then reprogram them for their networking requirements.

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Using SDN could save companies cash & enable them to employ smaller amount technicians. It's not known how large the market is for software-defined networking products because the idea attracts a lot of different definitions, but main givers of business technology including VMware Inc. VMW +2.33% , Hewlett Packard Corp. HPQ -1.54% & worldwide Business Machines Corp. IBM -0.28%  are moving insistently into the area.
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For its part, Cisco has approached the so-called SDN trend with a standard they announce is more complete than Open Flow. Executives there are taking a wait-and-see attitude toward adopting the Open Flow technology, which could undermine the company's 66% enterprise-market share in routing & 75% hold on switches, according to research firm Gartner Inc.

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