Blog Post

Cisco & Google: Enemies Now & Forever

A few weeks ago, GigaOM contributor and veteran entrepreneur Allan Leinwand wrote a post entitled Cisco vs. All Comers. Well let’s add Google to that list of all comers. The Financial Times reported today that Cisco is developing a new “ultra-high-speed system for internet access in partnership with a number of U.S. service providers, according to people close to the company.”

Cisco, it seems, is trying to counter the unease caused by Google’s recent announcement that it will build Google Fiber, a fiber-based network that would connect homes at speeds of 1 Gbps. That’s despite the fact that Google executives dismiss the idea that the company would become a service provider, and characterize their proposed network as an experiment.

Regardless, the carriers are scared. Just like they were scared when Google said that it would start investing in wireless broadband by participating in wireless spectrum auctions. Earlier today we held our most recent Bunker Series Event where we discussed the broadband buildout ( GigaOM Pro, sub req’d), and I was pretty explicit in making the point that Google Fiber is a good thing, because incumbent carriers have been dragging their feet for too long.

When I emailed Cisco PR earlier today to get a comment on Google’s fiber plans and a clarification on the FT story, a company spokesperson wrote back:

Cisco is committed to continuing to partner very closely with service providers to enable advanced new telecommunications services. Cisco does not typically comment on other companies’ plans or products. With that said, Cisco believes that a next generation Internet will enable economic growth and job creation, as well as improve the delivery of health care, education and energy.

The spokesperson went on to note that:

In order to reap these benefits, the U.S. needs high-speed, future proof broadband networks that are accessible and affordable to all. Those networks will be predominantly built by the private sector, including new and existing operations using fixed and wireless technologies, various business models and partnerships and industry structures to create the next generation Internet. We believe the market will decide the best combination of those elements and that government policy should promote the most viable options.

And lo and behold, Cisco later emailed us an invite for an event on March 9, where the company “will make a significant announcement that will forever change the Internet and its impact on consumers, businesses and governments.”

Put two and two together and you can tell that something’s up. Ah, nothing like threat of Google to get technology companies re-energerized.

Updated: Since some of you asked in the comments, here are some of my previous posts about Google and Cisco and their looming competition. The competiton between Cisco and Google is going to manifest itself in many ways. The most obvious one will be in the emerging collaboration space.

Will Collaboration Pit Cisco against Microsoft, Google?Cisco versus the World.

Google’s real impact will not be that obvious to the naked eye. I am going to write a longer, more elaborate post sometime this weekend and share it with you.

21 Responses to “Cisco & Google: Enemies Now & Forever”

  1. Just because Goog is going to test a broadband deployment doesn’t mean that Cisco responded to somehow 1-up Google. Cisco hasn’t even been in the broadband / SP business, other than on the edge with cheap boxes aka Linksys. I wrote up more about Goog’s reasons for pulling the trigger on broadband and I agree with the above commenter – Gb EPON is the reason.

  2. Missed the mark a bit on this one huh? Hope you don’t spend much time in Vegas. Cisco only announced “a router”. No service provider network, no competition with google, just another big fast router. No big deal

  3. opticalgirl

    This was a boo boo on the part of the FT. The journalist was taking a briefing about a product upgrade in the core network of a major US carrier, they then put 2 and 2 together and came up with 5.

    The core of the internet and broadband are completely different parts of the network, upgrading one does not speed up the other. Are there no journalists out there that understand this?

  4. The key, ultimately, is in the applications and services that the plumbing–fast plumbing though it may be–carriers. Guess who wins that one? I agree–competition is a good thing, and unified communications, both in its precise and more generalized sense, will be the winner.

  5. Given that Cisco and Juniper hold like 95% of the core routing market, It will be interesting to see what Google uses to deploy their network (Build their own or use one of the handful of players than can route this much traffic). I’d heard rumors of Google building their own 10GigE switches.

    For arguments sake though, going with Nexus switches wouldn’t be that bad. A full size nexus 7000 full of 48 switch ports would on my napkin calculations cost under $400 a port (House)

    I know there are routing and other needs but compared to the cost of the dig I don’t feel like this is really all that expensive. Given that Google is only running a local loop network anyways, it might make sense for the actual ISP to be deploying the core switches and being the ones who light the fiber.

  6. Indu S Das

    like others i don’t’ see a competition per-say here, but liked the chances that Cisco might come into providing ultra high speed network.
    The ISPs have been procrastinating for ever in upgrading their network. someone need to wake them up.

  7. After a second read, I agree with the sentiment of many of the other comments. What part of Google’s FTTH experiment is a threat to Cisco? If anything, Google is accelerating the FTTH market, an unequivocally GOOD thing for Cisco.

    Om, are you simply implying that because the major SP’s are Cisco clients, Cisco is forced to “choose a side” between the telecom’s and Google?

  8. This was a poorly written article with a sensationalist headline.

    Just because Goog is going to test a broadband deployment doesn’t mean that Cisco responded to somehow 1-up Google. Cisco hasn’t even been in the broadband / SP business, other than on the edge with cheap boxes aka Linksys. I wrote up more about Goog’s reasons for pulling the trigger on broadband and I agree with the above commenter – Gb EPON is the reason.

    Though these economics could also spur Cisco to move, the fact is neither one of these companies is even in this market today, and each gets a net benefit from the others actions here – not a zero sum game.

  9. So what routers and switches will Google use in deploying their fiber? Somehow I don’t believe “HP” is the name that comes to mind…

    My way of saying: they’re not enemies, they’re in completely different markets… for now (avoiding Cisco’s market adjacencies on the video front). So no, they’re not competing. Who knows, they might even announce a new NEXUS edition which will enable Google’s fiber at consumer prices.

  10. I think that you’re reading too much into this.

    Cisco’s carrier customers are threatened by this and Cisco’s muted response is aimed at avoiding offending them. Cisco themselves are not threatened by Google moving into the carrier business – they would be as happy hawking their kit to Google as they are to anyone else.

    There are other areas where Google and Cisco will compete head to head by broadband supply is never likely to be one of them.

  11. I’m not sure how this makes them enemies…

    Google announced that project because it wants to push others to provide high speed Internet, it’s not in that business. But it has the most to gain from there being a high speed Internet broadly available. Cisco would like that too — more gear to sell.

    How does this make Cisco and Google enemies?

    • 6knowspring

      Good point- I don’t think that Google is going to enter into this business either.

      Would be interested to see a reply to your question: “how does this make Cisco and Google enemies?”, too.

  12. Curious if this means Cisco is going to make another run at building products for service provider access networks. They’ve historically flailed pretty badly in this market, but the technology is playing more-and-more to their strengths (Gigabit Active-E).