Why Cisco & Microsoft Are Uneasy Frenemies?

If the 1990s were all about client server wars – Oracle versus Microsoft versus everyone – the coming years will be all about communication centric software. And that means Microsoft will tussle with Cisco, current peace accord not withstanding. Continue reading to find out why. By Allan Leinwand

Recently, Om wrote that Cisco (CSCO) and Microsoft (MSFT) have made their peace over VoIP. But while this peace accord makes a good press release, don’t be fooled: These two companies are mortal enemies locked in a fierce competition for the crown jewel of medium and large corporate IT infrastructure – enterprise messaging.

Although I am a fan of open-source software and other enterprise messaging solutions, there’s no denying that Microsoft, with its Exchange product, owns medium- to large-enterprise messaging. This despite the fact that many others have tried to break into this market over the years, including on-going attempts from the likes of IBM (IBM), Zimbra and Google (GOOG).

Looking at Exchange, you’ll see that Microsoft has spent years building and acquiring not only email and calendaring but anti-virus, anti-spam, unified messaging and mobile messaging – which sounds suspiciously like the world of enterprise networking, the domain of the 800-pound gorilla in San Jose, Calif. called Cisco Systems. Meanwhile, Cisco, which has a proprietary lock on enterprise data networking, has moved into voice, and is in particular making a big push into video with products like TelePresence.

Then, back in February, Cisco acquired San Francisco-based social networking vendor Five Across for an undisclosed sum and folded it into the company’s media solutions division.

Like many folks, I was scratching my head over this purchase. That is until recently, when a friend of mine told me that she only uses email to communicate with people outside of her MySpace network. She writes, she said, “maybe an email or two a day.” I subsequently conducted a thoroughly informal survey of people that I know to be Facebook power users and indeed, they also appear to gravitate toward the use of Facebook posts instead of email.

And that got me thinking about Cisco and Microsoft again. Today’s social networks are clearly a consumer market phenomenon. But my friend who uses MySpace at home also works in an office, where she needs to communicate with her co-workers and contacts both inside and outside of her company. These business messages are the same text, audio calls, video clips, shared files, calendar appointments and IM that currently live inside of Exchange. And sending messages to a trusted person within a business social network should be as easy as messaging Tom on MySpace.

So could a Cisco social networking platform aimed at the enterprise market enable messaging, interaction and collaboration and, by extension, be a wedge against Microsoft and their current lock on the enterprise IT messaging market?

To be sure, one startup acquisition does not set product strategy or give instant credibility, even for a company as large and entrenched in IT as Cisco.

But if Cisco could use a social networking platform to loosen Exchange from the center of enterprise IT messaging, it would propel them into a whole new realm of business opportunities – and straight into a fierce battle with their friends at Microsoft.

Disclaimer: I worked for Cisco from 1990-1997 and am founder of Vyatta, an open source networking company with products that compete with those of Cisco.

Allan Leinwand is a venture partner with Panorama Capital and founder of Vyatta. He was also the CTO of Digital Island.

loading

Comments have been disabled for this post