Practical Analysis: IT Pros Don't See Cisco's Claimed TCO Advantage

FOR IMMEDIATE RELEASE
(Free-Press-Release.com) May 16, 2011 -- Cisco has been fighting a PR battle with competitors over a Gartner report, released in November, that says multivendor networks are less complex to run than all-Cisco networks and could translate into a 20% cost savings over five years. Competitors love the report, of course, while Cisco says Gartner's advice is myth-based.

Cisco says the problem is that Gartner, and networking Johnny-come-latelies such as Hewlett-Packard and Dell, talk and think too much about acquisition price and not enough about long-term total cost of ownership. Perhaps, but what do IT pros think matters, and where do they put Cisco?

In InformationWeek Analytics IT Pro Ranking of data center networking vendors, they asked just that. As it turns out, IT pros agree with Cisco: Acquisition cost isn't the most important consideration. In fact, it ranks fifth of 10 criteria, after reliability, performance, operation cost, and quality of post-sales support.

With a priority list like that, a white-glove vendor such as Cisco must stand out from the competition, right? Wrong. Cisco fares well in our ranking, but HP and Brocade do just as well, and IBM and Juniper are close behind.

Clearly, Cisco must attribute some benefits to its own products that its customers don't, and here's where our survey respondents agree with Gartner. While Cisco gets high marks for reliability, performance, and the breadth of its product line, it gets low marks for service innovation, operation cost, and acquisition cost. HP and Brocade top Cisco on operation and acquisition cost. In other words, based on the experience of IT pros, Cisco is the one living the myths, not Gartner.

As much fun as it is to watch a major vendor defend untenable positions, the main point is that while reliability and performance got Cisco to the top of the heap (the fans were so strong in the original AGS routers that they held the faceplate on even when the screws were removed), those attributes are no longer so important. Merchant silicon is so good that two electrical engineers and a kid with a soldering iron can make a pretty reliable wire-speed 10-Gbps Ethernet switch with redundant power supplies and fans. What's not so easy to do is support emerging technologies like virtualization with a flexible and powerful management architecture. That takes some engineering, and standards work.

Not good for Cisco. In the same survey, we asked which features matter most for data center switches. The answer: virtualization support, adherence to standards, and configuration automation. IT pros care least about proprietary technology in advance of standards and a migration path from 40-Gbps to 100-Gbps Ethernet. You can start to see the challenge for Cisco, whose management system for Nexus tries too hard to preserve the legacy interface for IOS, doesn't do enough for automation, and of course assumes an all-Cisco environment. As a result, Cisco is in the middle of the pack on feature scores, which makes it hard for the company to demand its usual acquisition price premium.

Every networking vendor will be talking about standards, ease of management, and virtualization and automation. And as a result, it'll be increasingly tough for Cisco to find a TCO case that offsets its high acquisition cost. This Gartner report is on the money.

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