Cisco: The big picture looks good

Cisco Systems held its analyst day confab on Wednesday and there were few surprises. But Cisco's big themes remain promising.

Among the themes that stuck out, according to analyst notes.

Emerging markets: Cisco (see all Between the Lines posts) projects that IT spending in emerging markets outpaces economic growth in these countries. Networking spending should expand even faster in these markets. You can expect many technology vendors to talk up emerging markets. That's where the growth is. Cisco estimated that its fastest growing regions in fiscal 2008 will be Middle East and Africa, India and Germany.

Unified communications and collaboration: There's no surprise that this topic was a big theme. Cisco has been talking up video for months. Here's what CIBC analyst Ittai Kidron reported:

Much of the event was in fact conducted over a Telepresence monitor. Nonetheless, it was a convincing statement of the power of unified communications to increase productivity and customer/employee/investor touch. It also reinforced how unified communications will catalyze growth in video traffic over IP networks.

Cisco also noted that the number of video streams tripled year over year from 2004 to 2006. In the enterprise video streams are likely to grow at the same clip. that means Cisco is going to sell a lot of gear.

According to other analysts such as Robert Baird's Kenneth Muth the telepresence meeting was a bit hit. Muth reported:

Via a Telepresence conference call between San Jose, New York, London and Hong Kong, executives discussed the global outlook for market opportunities. In the

U.S., service providers, Federal government and certain verticals like healthcare and high tech manufacturing are very robust at the moment. While there has not been an obvious slowdown in financial sectors, executives are watching this vertical carefully.

Web 2.0: Cisco was bullish on Web 2.0 as a productivity tool. Picture an enterprise analogy to Skype and YouTube. And the ROI case is obvious--more telepresence and less travel costs.

The networked home: Cisco also spent some time talking about hosted services, home security and video surveillance. I happen to think networked video home security systems will be huge. Cisco's argument for this market is a little tougher given competition from other large players.