Cisco eyes emerging markets

Speaking at Cisco Systems Inc.'s annual Partner Summit meeting here on Tuesday, Mike Volpi, Cisco's chief strategy officer, announced that the company is planning to target four key markets: VOIP (voice over IP), wireless LANs, content networking, and streaming media.

VOIP clearly tops Cisco's list of new playing fields, and the company hopes to move the technology beyond its image of merely providing low-cost telephone calls.

"IP telephony is not [just] about cheap minutes," Volpi said. "IP telephony is about a new set of applications and opportunities for profit." Late last month Cisco officials detailed the company's plans to deploy an IP infrastructure that would enable applications such as custom-built XML utilities, unified messaging, voice recognition, and broadband voice.

Although Volpi did not reveal any specific product plans, he said that Cisco's wireless LAN play will revolve around an increased demand for mobility, ubiquity, and persistence. Third-party applications will be aimed not only at mobile workers, but also at sectors such as health care and education, he said.

"Most of the buzz around wireless has been around 2.5G and 3G technologies. But we've also seen a tremendous amount of traction in our 802.11 offering," Volpi said, referring to the IEEE's 11Mbps wireless LAN specification.

He added that Cisco's wireless LAN efforts will complement, rather than compete, with 2.5G technology, because the company expects end users to demand faster wireless speeds in their offices and homes than they will on the road. Scottsdale, Ariz.-based research firm Cahners In-Stat Group predicts that the market will grow from US$1.2 billion in 2001 to US$2.7 billion in two years.

Cisco also plans to move aggressively into the content delivery arena, where it will face rivals such as Nortel Networks, Inktomi, and Akamai Technologies. Content delivery is a relatively new field in which frequently requested data is intelligently cached on a network, and through which routers and switches can send packets based on personalized information, or sense that a user is connecting with a PDA and tailor the data appropriately.

Suggesting a new direction in the way content delivery is implemented, Volpi pointed out that Cisco's strategy will extend beyond the service provider market.

"More than half of our CDNs [content delivery networks] are deployed by enterprises for specific applications, like e-learning or customer relationship management," Volpi said.

Moreover, the content delivery market appears to be primed for an explosion: Internet Research Group, a Los Altos, Calif.-based think tank, predicts the industry will balloon from $1 billion today to $6 billion by 2004.

Cisco also has its eyes on streaming media -- although, according to Volpi, the market is not yet ready to yield substantial profits.

"It's clearly not a tornado market yet, but we're starting to see some early signs," Volpi said. He added that when media content is decoupled from the delivery vehicles to which it has historically been attached, enterprises will benefit from the increase in adaptability.

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