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Rank - 20 : Cisco Systems : End of Monopoly?

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DQI Bureau
New Update

Cisco has been enjoying near monopoly in the networking market in India for
years, but FY10 showed the first signs of change. HP Networking (formerly
ProCurve) is emerging as a serious challenger; the acquisition of 3Com would add
further momentum, especially as Indias #1 hardware vendor has publicly
disclosed its plan to topple Cisco The FY10 market itself was flatit impacted
Cisco seriously in H1, with a turnaround visible only from H2. There were
initial hiccups in uptakes in both IT services and telco; and when investments
in 3G and IPTV got deferred, it made things worse. There was a sharp decline in
revenues from August to October 2009, but Cisco picked up momentum again
November onwards with some major wins in Commonwealth Games and APDRP projects.
The turnaround of the IT services sector as well as fresh investments in the
mobility space also smoothened up things.

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One lesson learnt was that Cisco might still have near monopoly in the
traditional routers and switches market, but increasing commoditization and new
competition meant that it had to increasingly look at new avenues to bolster
revenues. Cisco managed to do it successfully with 30% of its revenues coming
from traditionally non-core areas like unified communications applications,
security, storage switches, WLAN and enterprise telephony. Cisco bolstered its
unified communications portfolio with the acquisition of TANDBERG and entry into
segments like enterprise social software and hosted email. Thanks to new
businesses like Ciscos Smart Connected Communities in collaboration with Lavasa,
the unified communications business ended up contributing Rs 147 crore.


Rank - 20 : Cisco Systems


Naresh Balwant
Wadhwa,
president and country manager

Rajesh Chainani, senior
VP, service provider

Pramodh Menon, senior VP, south & Sri Lanka

Anil Bhasin, senior VP, west

Amit Malik, VP, east,

N Raj, VP, south,

Sandeep Raina, senior VP, north

HIGHLIGHTS
  • Acquisition of Tandberg in
    the unified communications space.
  • Collaborated with NSE to
    provide network security and scalability


5
 Strengths

  • Growing clout in the
    enterprise telephony segment
  • Partner ecosystem was well
    maintained


6
Weaknesses

  • Low margins in the
    traditional switching and routing markets
  • Freeze on investments in 3G
    and IPTV could impact business
  • HP has the financial muscle
    to seriously challenge Cisco after the 3Com acquisition
 

FACTSHEET

l Start-up Year: 1995 (India) l Products and Services: Networking l
Address: Birla House (East Tower), 25 Barakhamba Road, New Delhi 110 001 l
Employees: 6,000 l Tel: 011 4261 1000 l Fax: 011 2376 6126 l Website:
www.cisco.com

The emphasis on innovation in product lines and new areas was evident from
Cisco adding Comstor and Compuage to its existing roster of national
distributors. Comstor focused on three advanced technology
offeringscollaboration, virtualization in the data center space and the
borderless networks portfolio. The deal with Compuage was inked to help Cisco
improve penetration in small cities and boost its SMB businessa 350% growth was
an unequivocal endorsement that the move succeeded.

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