June 03, 2009, 9:15 PM — Cisco Systems Inc. is proud to be joining the Dow Jones Industrial Average on Monday, but Cisco CEO John Chambers said that did not come without mixed feelings given the company was replacing General Motors.
"It's a tremendous honor ... [but] very humbling," he told a group of international reporters today at the Cisco Partner Summit here.
Chambers said he was "obviously very proud," but said he has "mixed emotions" about replacing GM on the list after the company filed bankruptcy this week. "GM is a great company, always a great customer, and a very very good partner," Chambers said, adding that everybody at Cisco knows somebody at GM. "It's an icon."
Still, Cisco's addition to the Dow, a market barometer, shows the importance of networking technology, Chambers said. "The network will play a huge rule as more than a pipe ... and be involved in areas of major economic growth. Hopefully we'll do a good job to make them proud."
HP-Microsoft: Rivalry is born
Chambers rarely comes across as a humble salesman of sophisticated networking gear, and actually did use much of his 40 minutes with news media to talk about the competition, including Hewlett Packard Co.
In May, HP announced a four-year partnership with Microsoft Corp. to provide unified communications products. Cisco executives at the Partner Summit said they would have preferred Microsoft picked Cisco.
"HP is a $110 billion competitor," Chambers said. "The last time we had competition like that was with Nortel, Alcatel and Lucent." In addition to unified communications, Cisco competes with HP in routing and switching.
Chambers said that Rob Lloyd, executive vice president of worldwide sales for Cisco, "will lead the charge against HP."
Lloyd told reporters today: "Microsoft has been saying for years that networking didn't matter, and suddenly they have a networking partner. They just picked the wrong partner."
Lloyd said that during the gathering of channel partners who resell Cisco products, he had heard many saying they are "indicating loyalty to Cisco" despite the HP-Microsoft partnership.
Video a 'game-changer'
Chambers and Lloyd emphasized the importance of video technology to Cisco, adding to comments made yesterday by the company's CTO, and earlier by other Cisco executives.
Video will make up 90% of all network traffic in two years, Chambers predicted, and will be a confirmation of Cisco's purchase Pure Digital Technology, Inc., the maker of the handheld Flip digital videocamera.
Chambers said the investment in Flip is not just about that device, but about the entire video architecture that involves taking easy-to-produce video and putting it on the Web or company-run video blogs, and also using it in addition to high-end telepresence systems and other collaboration tools.
He said that much of Cisco's advertising and branding effort in recent years, including product placements of Cisco telepresence gear in the TV series 24, revolves around the value of video technology to consumers, companies and the company.
"We see a tremendous desire to deploy consumer-type technologies but in an enterprise form-factor," Lloyd added.
Proctor and Gamble is deploying Flip cameras to its executives to use in video blogging, even as that company has invested heavily in telepresence, Chambers said. "Video is the way leaders communicate," he said.
To show his interest in video and the use of the Flip, Chambers pulled a Flip camera from his pocket and quickly panned the room of reporters. He said he used the video camera to communicate with his children.
"Cisco is a long way ahead in this technology," Chambers said.
