Important Facts Partners Should Know About Cisco

 
 
By Michael Vizard  |  Posted 2016-11-08 Email
 
 
 
 
 
 
 
 
 
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    1 - Important Facts Partners Should Know About Cisco
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    Important Facts Partners Should Know About Cisco

    The entire Cisco channel ecosystem is changing. There are apt to be plenty of bumps along the route to that transition, but there's no turning back.
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    2 - Sizing the Cisco Americas Channel
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    Sizing the Cisco Americas Channel

    Over the Cisco channel for the Americas is a $20 billion organization. The Americas channel encompasses about 100,000 individuals.
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    3 - Licensing as a Competitive Weapon
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    Licensing as a Competitive Weapon

    Cisco reports that 2,700 partners have now sold a Cisco One license to 14,000 customers. The goal is to encourage customers to update their Cisco network and data center investments at the expense of Cisco rivals. Cisco officials said $10 billion in revenues is now attached to Cisco One licensing programs.
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    4 - Rise of Cisco DNA
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    Rise of Cisco DNA

    Cisco Digital Network Architecture (DNA) is in the process of making it possible to run large swaths of its software portfolio in the cloud or non-Cisco hardware. As part of that effort, Cisco now has more than 200 Virtual Network Function (VNF) modules available. Cisco said it now has 14,000 DNA customers, representing $49 billion in revenue.
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    5 - Cisco Focuses on Solutions
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    Cisco Focuses on Solutions

    For three years, Cisco has been pouring 25% of its U.S. channel resources into a Partner Organization tasked with aligning partners with independent software vendors (ISVs) and consulting firms. Open APIs are at the core of that effort.
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    6 - Cisco Lead-Gen Efforts
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    Cisco Lead-Gen Efforts

    Cisco claims to have generated 44,000 leads relying on digital marketing techniques. A full 57% of those leads have been converted into sales opportunities. Overall, Cisco officials said there has been a 23% increase in actual orders in the last eight months. In the future, Cisco plans to apply analytics to better identify the size of the opportunity, the share of wallet Cisco has, and the propensity a customer may have to purchase Cisco products and services.
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    7 - Cisco Leads With Security
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    Cisco Leads With Security

    IT security is easily the most profitable segment of the Cisco product portfolio for solution providers. Those security products also often drive network upgrades.
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    8 - Cisco Drives Into the Data Center
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    Cisco Drives Into the Data Center

    A new dedicated data center business unit led by Roland Acra now combines server and switches together in a way that should make it easier for partners to sell blended solutions.
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    9 - Cisco Smoothes Cloud Collaboration Transition
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    Cisco Smoothes Cloud Collaboration Transition

    A new Cisco Spark Flex licensing plan makes it simpler for organizations to acquire end-user licenses that can be applied to both the Cisco Spark collaboration services in the cloud, instances of WebEx delivered as a service or hosted by the customer, and on-premise unified communications and telephony technologies. Cisco claims to have 100 million phone endpoints currently installed.
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    10 - Cisco Defends Router Base
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    Cisco Defends Router Base

    Cisco built its business on routers. But those routers are now being replaced increasingly by software-defined wide-area networks (SD-WANs). Cisco has its own SD-WAN that it is now turning into a platform for applications such as video cameras.
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    11 - Apple at the Mobile Partnership Core
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    Apple at the Mobile Partnership Core

    After forming an alliance with Apple that integrated Apple iOS devices with Cisco wireless access points, Cisco wants partners to sell that solution.
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    12 - Balancing the Channel
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    Balancing the Channel

    Cisco has both a Volume Incentive Program (VIP) that rewards partners for sales volume as well as a Technology Incentive Program (TIP) that rewards partners for investing in specific product technologies by providing additional back-end rebates and discounts.
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    13 - Licensing Programs as an Operating Expense
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    Licensing Programs as an Operating Expense

    While most of Cisco's revenues are generated as a capital expense, there is a steady shift toward multiple types of leasing programs that allow organizations to acquire IT infrastructure running on-premise as an operating expense that is similar to a cloud service.
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    14 - Cisco's Lifecycle Advisory Program
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    Cisco's Lifecycle Advisory Program

    Cisco is attempting to drive upgrades across its installed base via a Lifecycle Advisory Program that identifies opportunities to drive upgrades.
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    15 - Cisco's Future
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    Cisco's Future

    By employing microservices, containers, machine learning algorithms and artificial intelligence, Cisco aims to automate almost every aspect of IT infrastructure management inside and outside the cloud.
 

As a company that generates $48.7 billion in annual revenues, Cisco is at the center of a channel ecosystem spanning 60,000 partners that account for 90 percent of those revenues. Two years ago, Cisco made a multi-year commitment to transform its own business model in a way that drives more recurring revenues. As part of the decision, Cisco, in effect, also is transforming the business models of its partners. Similar to the transition that channel partners need to make when shifting to the cloud, most partners are not ready to deal with wholesale changes to their business models. For that matter, many customers are not yet ready to give up using capital budgets to pay for network infrastructure. In their minds, networking software is still attached to the box. The end goal is to sell more networking and data center products and services in a way that generates more predictable revenue streams. Of course, there will be plenty of bumps along the road to that transition, but like it or not, there's no turning back now for Cisco or the channel.

 
 
 
 
 
 
 
 
 
 
 
 

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