They say contentment comes from knowing your place in the universe. For Lloyd Carney, Brocade’s place is in the data center, not in the wilds of trying to connect every possible electronic device to the Internet.
During a presentation this week, Brocade Communications CEO Carney told investors and analysts that Brocade is going to take on Cisco by focusing on what it does best – building and enabling high-performance data centers and not chasing wild marketing slogans.
“We don’t do the network of everything,” said Carney, according to Enterprise Networking Planet. “I have no interest in networking my fridge. We’re all about the data center.”
“We know with certainty where the puck is going and we’re gliding right there. The end result is that we’ll enable our customers to be more efficient so they can do more with less,” he added.
Cisco is pushing the notion of the Internet of Things, in which more than 50 billion IP-enabled devices will be connected to the Internet. Building networks that can process all the traffic and data generated by these devices is a $14.5 trillion opportunity, Cisco says.
What Brocade’s Carney is probably postulating here is Cisco is overreaching. While more electronics – everything from refrigerators to sewerage systems – are being connected to the Internet, the immediate and more addressable opportunity is in the data center.
Moreover, Carney believes Cisco made a strategic mistake getting into the server business. For years, Cisco partnered with server companies such as IBM, Hewlett-Packard and Dell to marry their products with its routers and switches. Now Cisco is a server vendor; while it has a small base, it’s growing significantly faster and at the expense of former partners.
Brocade plans to take advantage of the tension between Cisco and server vendors by forming strategic partnerships to create integrated data center solutions.
Brocade isn’t the only company that believes it can take on Cisco. Last week Extreme Networks plunked down $180 million to buy Enterasys, virtually doubling its size overnight. With Enterasys technology, Extreme plans to attack Cisco’s core networking business as well as its flanks of security, wifi and management software.
In 2011, Cisco got into trouble by trying to press too many and divergent products and strategies. The result was a restructuring that downsized the company to focus mostly on enterprise solutions. While Cisco is growing, it’s also seeing challenges ahead caused by economic uncertainty. Next week, Cisco will start another round of layoffs in which it will reduce global headcount by 4,000.