BG: What we see generally is that people are moving towards hosting. But, in general, there are bigger datacentres being built and people are consolidating into fewer locations. Part of what is driving that frankly, is server virtualisation; being able to have hypervisor-based server infrastructure for all your applications. It is a telling ROI.
What other things are you looking to introduce in the next 12 months?
BG: The other thing we announced recently in the datacentre space was our SRX product, which essentially is a services integration product. The problem that we are trying to solve is there are lots and lots of appliances all over the datacentre. The overall way we are trying to solve the problem is to reduce complexity through having less devices. Next year, what we are looking at is higher densities and 10GB Ethernet. Based on what Intel tells us, they will be putting 10GB Ethernet on the motherboard for servers mid next year. When that happens, the price of 10GB Ethernet servers will come dramatically down. Today it is about $2000 a server and you have to buy a separate card. But server virtualisation is causing utilisation rates to go much higher on servers and so 10GB Ethernet is approaching the requirements of bandwidth. We think the number of people that are going to want 10GB Ethernet at the server access layer is going to explode. What we are releasing in the first quarter of next year is the EX8200 Ethernet switch.
You’ve spoken a lot about reducing cost and complexity. Have we gotten past the focus on green IT?
BG: I think the customer focus on green has changed. Before, it was what do you guys have for green? In our experience, people never bought networking gear because it was more power efficient or it was generating less heat. That has to be the third or fourth thing. You first have to provide a level of performance and features and then after that criteria is met, is it taking up less power or space? The conversation now is, we get it, it is physics and if we are going to put more chips into a card it is going to create more heat. If we are going to create more heat, we need more air conditioning and then we are going to need more power. So the only way to get greener is to have more dense devices, which reduce the number of devices that you had before. The green is a result of simplification.
How do you see the competitive landscape playing out in this climate?
BG: Our focus as a company is to keep growing our enterprise market share and present more of a networking portfolio for our customers. The market driver we are banking on is that most enterprises are frustrated with not having a choice. They might still buy the incumbent, but they want the option of evaluating somebody else. Staying with a single vendor operationally is more advantageous for a lot of people but it does have its disadvantages. What they see in us is the opportunity to have more of the end-to-end infrastructure without having to buy voice or other aspects that Cisco is pushing.
