It seems that my friends at IBM have finally realized that Cisco is serious about taking them out. As I have stated before, Cisco has feasted on smaller rivals and shrewed acquisitions. However, they have never faced a competitor with the talent, resources, patents, and reach such as IBM.
A few days ago, IBM launched a patent assault on Cisco by cross-licencing technology to BLADE. Today, IBM is moving further away from Cisco and will begin selling Ethernet switching and routing products from Brocade. While IBM has dabbled with Juniper, Brocade is a serous enterprise threat to Cisco via their acquisition of Foundry Networks.
Cisco relies on IBM and IBM Global Services to resell their equipment to enterprises around the world. As IBM begins to diversify its portfolio, Cisco sales are sure to suffer. Combine this with the fact that Cisco faces the same issue with HP, and it could spell trouble.
Additionally, if Sun and/or Dell ever get their act together they could do some damage as well. Never mind the fact that Huawei’s growing like a weed, Nokia is looking to buy parts of Nortel, and Siemens is back on track, and Alcatel-Lucent looks like it is finally coming together. How many battles does Cisco want to fight at once? What about Cisco’s other divisions?
IBM isn’t going to cede the data center to Cisco or anyone else. Plus, IBM has the tools needed to manage the entire infrastructure; something Cisco must acquire (BMC). For now, let’s see if this three way war between Cisco, HP, and IBM leads to a victor or will someone unexpected arise? One thing is for sure, IBM’s going for the revenue jugular.