Chambers: Cisco hot for storage networking

The storage market continues to be a priority for Cisco Systems Inc., as its customers demand that the networking giant expand into this area, Cisco's President and Chief Executive Officer (CEO) John Chambers said Monday at Gartner Inc.'s Symposium/ITxpo.

"I've got my best engineering team on this," he said.

Cisco launched its push into storage networking about 18 months ago when it launched its "Storage Networking Initiative" in April 2001.

Cisco's move into this market has been motivated by customer demand for storage switches and routers, Chambers said. The company's strategy is centered on acquisitions, internal product development and on establishing long-term relationships with partners, Chambers said.

Chambers is "very optimistic" that Cisco, although a newcomer to the storage space, will become a leader in this area.

In August, Cisco announced its intention to buy Andiamo Systems Inc., a manufacturer of storage switching products for the Storage Area Networking (SAN) market, in an all-stock deal expected to close between February and April 2004. That same day Cisco also announced that Andiamo's family of multilayer intelligent storage switches for storage area networks (SANs), expected to begin shipping before the end of this year, will carry the Cisco brand and be known as the MDS 9000 family. Cisco, based in San Jose, California, also has struck a variety of partnerships with storage vendors and created a storage networking division.

As usual in Gartner's Symposium/ITxpo, Chambers didn't give a traditional keynote speech, but rather answered questions from two Gartner analysts who joined him on stage.

When they asked about the increasing gap between the price of Cisco products and the products of its competitors, which the analysts said has grown significantly over the past year, Chambers said he remained confident that his company's clients feel that paying a premium for Cisco products continues to make sense. He cited a recent Cisco survey which he said shows that about 90 percent of company clients feel that Cisco's pricing is fair.

Chambers also said he's confident Cisco will not suffer from Dell Computer Corp.'s entry into the networking market. Cisco last month dropped Dell as a reseller of its networking products, a sign that Cisco has begun to consider Dell as a competitor.

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