Cisco VP: Net growth spurs revenue

Cisco Systems' quarterly results reported yesterday proved wrong several business publications that had predicted the company could not continue its strong growth. But company executives knew all along that demand for Cisco Internet-building equipment ensured continued profit, a Cisco official said at the NetWorld+Interop (N+I) 2000 show.

For the third fiscal quarter, Cisco reported revenue grew 55 percent to $US4.92 billion, and earnings rose 4.1 percent to $662 million.

Larry Lang, Cisco's vice president of service provider marketing, said demand remains intense as service providers link more and more businesses to the Internet and include ever-more sophisticated services.

"The day-to-day experience of what we see going on with our customers shows ongoing growth that is remarkable," Lang said in a question-and-answer session following his keynote speech here at the show. "The third quarter is historically difficult, yet we've seen some of the sharpest increases (in sales) in a long time."

The Internet has grown faster than any other communications system, Lang said during his keynote speech. The Net grew to 50 million users in just four years, he said. To reach a similar benchmark, television took 13 years and radio took 38 years, he said.

"In October 1994, Netscape shipped its first commercial browser," he said. "Who would have thought what has gone on since then?"

Lang documented the demand for Cisco products during his keynote speech, highlighting several service providers that use Cisco products to develop Internet services for brick and mortar businesses.

BlueLight.com, Kmart's e-commerce Web site, used Internet and network service provider ICG Communications to help develop and manage its site. Similarly, the Financial Times newspaper contracted with service provider Digital Island to develop a global network for the newspaper's FT.com website.

These Cisco-powered service providers are allowing companies like Kmart and the Financial Times to offer more services on their Web sites, Lang said.

"We are seeing a cycle of growing volume, decreasing costs and new applications," Lang said. "Old applications were focused on employees and on client-server applications. Now, new applications are focused on customers and suppliers. That's why so much attention from the executive suite is shifting to technology."

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