Tomahawk, WI 03/18/2014 (Basicsmedia) – Cisco Systems Inc. (NASDAQ:CSCO) is at the core of the networked world we live in. Its routers, switches, networking operating system and other offerings constitute a significant part of the infrastructure of the World Wide Web. With a market capitalization of over $100 billion and revenues of nearly $50 billion, Cisco is one of those giants who are here to stay.

It has a plethora of products for small and large enterprise clients including routers and switches, IP video phones, IP NGN, IP camera, WiFi access points, VoIP servers, datacenter products, VPN clients, IOS software, etc.

Challenges Galore for Cisco

When you are a giant, you face challenges from different quarters. Cisco faces challenges from both smaller and nimbler companies like Juniper Networks, Inc. (NYSE:JNPR), VMware, Inc. (NYSE:VMW) and from others like Dell who sell cheaper networking equipment.

The challenges facing an established company like Cisco are similar to the challenges being faced by Microsoft Corporation (NASDAQ:MSFT) where its dominant position in software is being challenged by newer and cheaper or free alternatives: Windows vs. Android, iOS and Linux, Internet Explorer vs. Firefox and Chrome, Microsoft Office vs. OpenOffice and LibreOffice.

Cisco is facing the heat from the new paradigm of Software Defined Networking (SDN) whereby VMware and Juniper are using software and virtualization to lessen the dependence on Cisco’s expensive and proprietary hardware.

Cisco is Well Entrenched and Strong

While Cisco has been steadily losing market share, it still enjoys 70% to 75% market share in the market for enterprise routers and switches. Cisco Systems Inc. (NASDAQ:CSCO) is hoping to counter the SDN threat with its own offerings including Application Centric Infrastructure (ACI) SDN.

It will be difficult for enterprises to replace their Cisco hardware very easily as replacing networking infrastructure can be cumbersome and involves a huge transition. Often, Cisco is a single-point supplier of a range of hardware including routers, switches, servers, IP phones, WiFi access points and videoconferencing systems and there is no other player in the market who can provide such a comprehensive end-to-end solution. Cisco Systems Inc. (NASDAQ:CSCO) is getting into hot new technology arenas such as cloud computing with its cloud networking platform, Meraki.

All of this should ensure that Cisco remains a strong player in the networking technology domain.

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