John Chambers predicts 'brutal consolidation' of IT industry at start of Cisco Live

Summary:The Internet-of-Things has been a focal point of Cisco's long-term vision for a few years now, fueling its developing rhetoric purporting "fog computing."


SAN FRANCISCO---The speed of change in technology is twice as fast now as it was three years ago, according to Cisco's CEO, who asserted the networking giant intends to repeat that process over the next five years.

In his 19th year as chief executive officer at Cisco, John Chambers held court at his 23rd appearance at the company's regularly scheduled IT summit, Cisco Live.

"You're going to see a brutal, brutal consolidation of the IT industry," warned Chambers, hinting at a "musical chairs-like movement" over the next few years.

He further predicted that many of the current players in "high tech" won't exist 10 years from now. Citing Gartner research and recent earnings reports, Chambers pointed fingers at IBM and Hewlett-Packard, citing the beleaguered tech giants haven't produced revenue for some time.

Defending "no one is going to eat our lunch," Chambers championed the Internet-of-Things movement as Cisco's trump card and key to revenue growth. He cited a handful of multi-billion dollar acquisitions in the last year to bolster this game plan, notably SourceFire and Meraki.

"You'll see us make a huge leap versus our peers," Chambers promised.

The Cisco chairman theorized that Internet-of Things requires both fast IT and fast innovation at a pace not seen before in order to deliver the right data to the right devices in real-time.

Chambers acknowledged that's easier said than done.

"We have to look to what Apple taught us. It has to be simple," Chambers remarked.

The Internet-of-Things has been a focal point of Cisco's long-term vision for a few years now, motivating the San Jose-headquartered corporation's recent push into the enterprise cloud market as well as its developing rhetoric around "fog computing."

Chambers reiterated how this concept is defined in which most data will be collected and kept at the edge rather than in the cloud.

Back in January , the Cisco IOx debuted as an architecture designed to provide routers and switches with computational abilities for the purpose of managing massive amounts of unstructured information pouring out of connected data points.

Essentially, that data would be computed more on the devices and sensors themselves, which has fueled Chambers and company to previously predict that the IoT market will blossom into a $19 trillion market in just the next few years.

In turn, this should lighten broadband consumption and demand loads on networks with the intention of pleasing everyone on points from better performance to lower costs -- at least in theory.

Shifting the compute location -- and the comprehension of that movement on the part of IT admins and employees alike -- might be more important than ever given the heightened debate over Internet security in the last year.

Cisco has been drawn into the center of that drama in the last few weeks. It was recently unearthed in former Guardian reporter Glenn Greenwald's new exposé tome that the National Security Agency has been hacking into Cisco-built routers and other IT equipment for the purpose of installing surveillance beacons.

In response over the weekend , Chambers penned a memo to President Obama, petitioning the U.S. Government to consider new rules preventing federal agencies from hijacking networking equipment at it moves through the supply chain.

Topics: Social Enterprise, Cisco, Cloud, Networking, Security


Rachel King is a staff writer for CBS Interactive based in San Francisco, covering business and enterprise technology for ZDNet, CNET and SmartPlanet. She has previously worked for The Business Insider,, CNN's San Francisco bureau and the U.S. Department of State. Rachel has also written for, Irish Americ... Full Bio

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