Will Cisco's Intercloud Bear Fruit?

By CIOReview | Thursday, March 27, 2014

FREMONT, CA: Cisco recently announced its plans to build what it claims to be the world’s largest global Intercloud by teaming up with a set of partners. The networking giant also expects to invest an excess of $1 Billion over the next two years to expand the cloud business. However, Cisco had no choice but to make an all-out effort to come up with its own cloud stack, writes Larry Dignan of ZDNet.

Cisco wants to be an IT partner of choice for the enterprise, but the company has all along been selling products that enable cloud computing and has not been offering cloud services. All of Cisco’s major competitors have their own cloud services: IBM acquired companies and built its own stack; Microsoft has Azure; Oracle, HP, even AT&T and Verizon have their own cloud stack. Cisco had to get into cloud in a big way for it to stop falling behind.

“In our view, Cisco's IT competitors such as Hewlett-Packard, IBM, VMware and others have aggressively rolled out their own cloud services, placing Cisco at a disadvantage in supporting the needs of its customers,” says Brian White, analyst at Cantor Fitzgerald.

The extent of this venture’s positive impact on the market and on Cisco’s bottom line is uncertain at this moment. Among Cisco’s cloud services, PaaS and IaaS will probably increase the networking giant’s customer base but it will be interesting to see if the company’s offerings can hold its own against Amazon Web Services. However, the Cisco Scansafe managed threat defense service is expected to be a possible hit.

“Cisco's portfolio has a decidedly networking spin to it and that move isn't all that surprising. The big question is whether Cisco's cloud efforts ring true to IT buyers,” says Dignan.