In my last post, I wrote about a conference call I had with Oracle, in which they talked about their strategy for the small and midsize business market. At the end, I said there would be another large-enterprise vendor talking about its new emphasis on small businesses. The vendor is Cisco, and the new emphasis seems like it has the potential to be important for the small business networking market.
I spoke with Mark Monday, vice president of marketing at Cisco, about the changes Cisco is making in their product line, their strategies, and their means of moving products from warehouse to customer. Put it all together, and it could make a real difference in the products you consider for your small-business network.
Cisco has just announced a new round of initiatives aimed at small businesses, which they define as companies with less than 100 employees. They’ve looked at the market in more detail as part of their commercial focus, and the outcome of their research isn't surprising: The small and midsize business market is very large (around $10B), and Cisco hasn't been getting as much market share as they thought they could. Why is that? Well, Cisco has a reputation for building hardware that is enterprise-ready but hard to deploy and manage. A small business owner can solve that by hiring a VAR or integrator to do the installation and maintenance, but the reputation, once again, is that Cisco channel partners (the VARS and integrators selling Cisco gear) charge a lot for their services because they've had to eat such a large up-front learning curve. It's not an overall reputation that leads to a lot of small-business sales.
Cisco has decided to address their problems in reaching people who buy network equipment for small businesses by doing four things. First, the company created a new technology group focused on building products and solutions for the small business market. (Mark runs one of the business units within the group.) Second, Cisco created a new marketing focus and assigned a VP for small business marketing. Third, they're creating a new presence/community on the Web for resellers and customers. This community-based approach isn't unique, but it's interesting to see Cisco leaning more heavily on the community of users and resellers to help build confidence in small business technical and purchasing folks. As part of all the marketing and community-based activity, they’re also refocusing a small business sales unit, complete with a VP. The fourth thing is they're looking at how they’re supporting the small businesses and partners and creating the STAC (Small business Technical Assistance Center). They recognize that supporting the small business is different than supporting the enterprise IT person.
I came away from this part of the discussion with two primary thoughts on Cisco's plans. First, all the talk of VPs and business units has the initial sound of furniture shuffling, but it does represent a significant investment in trying to sell products to small businesses. It indicates that this isn't a short-term project for the company, but a real change in the way they look at this market. Next, the rather obvious statement that small businesses require a different sort of technical support than large enterprise technical teams indicates that Cisco is looking at the market with a bit of realism. Each of these is a pretty good sign if you're a small business owner thinking about switching your network infrastructure to Cisco.
The first two changes Cisco is making, mentioned above, are to a certain extent "inside baseball" -- changes that will be seen more by their effects on the market than as things that are visible to customers. The next two changes, though, will be very visible. Cisco is bringing out two new product lines: Cisco Small Business and Cisco Small Business Pro. The businesses that aren’t afraid of deploying their own networks may go to Best Buy and get something off the shelf from the Small Business Line. The partners who sell to small businesses will end up buying from the Small Business Pro line. To recap: off-the-shelf means Cisco Small Business; from an integrator means Small Business Pro.
The announcement were were discussing didn't involve any new products, just the new product lines. So where are the products coming from? Cisco is combining the Linksys Small Business Organization and the Cisco Small Business Organization. Over time, the Linksys Small Business line will be converted into the Cisco Small Business and Small Business Pro line. As products in the Linksys line age out, they’ll be replaced by the Cisco products. The first products under the Cisco Small Business and Small Business Pro lines will start appearing in the fourth quarter of this year, and Mark says that there are lots of products coming out in the next six to eight months.
So how will the Small Business and Small Business Pro products differ? All of the products in the small business line will have a Web interface with a consistent look and feel. If you install the Small Business access point and want to install the Small Business switch, you’ll be familiar with the configuration and administration interfaces. In the Small Business Pro line you're likely to be faced with Cisco's IOS, although Mark told me it’s possible you’ll have a single tool that will let you configure and manage all the products and allow for some unified configuration and administration.
Mark told me that the same basic functionality will be represented in product groups in both the Small Business and Small Business Pro lines with one likely exception: Voice will probably be a Pro product line because of the configuration required. I've set up small business VoIP systems and can see the logic behind this plan. It's not really that the networking side is horrifically complicated, but making sure everything talks as it's supposed to with the PSTN (telephone network) can be complicated and require knowledge that most computer networking folks don't have (and don't particularly want to obtain).
It's important to be clear about one thing: The Linksys name is not going away for consumer-level products. It will, instead, be used only for consumer products. If you go looking for a business networking product from Cisco, it's going to have a Cisco label, although it will take a while (there was no hard timeline given) for products with the Linksys name to work their way through sales channels and product life cycles. The end result, for small business network buyers, is another serious option to consider for their network infrastructure.