Cisco to spend US$16B in China over next five years

Cisco Systems Chairman and CEO John Chambers announced a US$16 billion commitment to business in China Thursday.

Cisco Systems Chairman and CEO John Chambers announced on Thursday US$16 billion in new investments in China, including manufacturing, investment and educational programs.

That includes a US$17.5 million investment in Alibaba.com Group as part of its initial public offering in Hong Kong next week, along with a Memorandum of Understanding (MOU) with that company to develop technology for small and medium-sized businesses in China and elsewhere.

Cisco will double its manufacturing in China, Chambers said, a move worth approximately US$14 billion, based on the US$7 billion Cisco said it purchased from China over the past five years. The company has great influence over where its suppliers manufacture, and many would be directed to do so in China, Chambers said.

The company will inject US$350 million into start-up investments and provide up to $400 million in customer financing via Cisco Systems Capital China, Cisco said.

It will also open another 300 of its Networking Academies to train 100,000 students on networking technology, as part of an MOU with the Ministry of Education, under which it will also donate US$6 million in networking equipment.

Missing from Chambers' speech was any expansion of Cisco's aggressive acquisition strategy to China. "We don't acquire competitors," he said, seeming to rule out a move for China-based rival Huawei Technologies. "We acquire to move into new areas." That strategy included the US$3.2 billion purchase of WebEx in March.

Chambers is on a whistle-stop tour of Asia, visiting India earlier this week, where he announced that 20 percent of top Cisco executives would be based in that country, along with signing a services agreement with Wipro.

"Both India and China have [growth, innovation and talent] in front of them. I don't think it's win-lose. I think both India and China win and in a big way," Chambers said in response to a question about the importance of each country to Cisco.

"We don't provide any unique capabilities to any government," Chambers said, answering an allegation that Cisco equipment is used by Chinese telecom regulators to block access from China to various international Web sites, including Wikipedia. "We will not enable any organization uniquely, including our own U.S. government," he said, also revealing that while he is a registered Republican and supporter of Senator John McCain's presidential candidacy. "One thing a technology company should never do is fall in love with one political party or one form of government."

"Cisco is one of Alibaba Group's most important partners, and our relationship with Cisco as it relates to our numerous small and medium-sized customers is extremely important," said Jack Ma, CEO of Alibaba, who also attended the event.

Join the newsletter!

Or

Sign up to gain exclusive access to email subscriptions, event invitations, competitions, giveaways, and much more.

Membership is free, and your security and privacy remain protected. View our privacy policy before signing up.

Error: Please check your email address.
Keep up with the latest tech news, reviews and previews by subscribing to the Good Gear Guide newsletter.

Steven Schwankert

IDG News Service
Show Comments

Brand Post

Most Popular Reviews

Latest Articles

Resources

PCW Evaluation Team

Luke Hill

MSI GT75 TITAN

I need power and lots of it. As a Front End Web developer anything less just won’t cut it which is why the MSI GT75 is an outstanding laptop for me. It’s a sleek and futuristic looking, high quality, beast that has a touch of sci-fi flare about it.

Emily Tyson

MSI GE63 Raider

If you’re looking to invest in your next work horse laptop for work or home use, you can’t go wrong with the MSI GE63.

Laura Johnston

MSI GS65 Stealth Thin

If you can afford the price tag, it is well worth the money. It out performs any other laptop I have tried for gaming, and the transportable design and incredible display also make it ideal for work.

Andrew Teoh

Brother MFC-L9570CDW Multifunction Printer

Touch screen visibility and operation was great and easy to navigate. Each menu and sub-menu was in an understandable order and category

Louise Coady

Brother MFC-L9570CDW Multifunction Printer

The printer was convenient, produced clear and vibrant images and was very easy to use

Edwina Hargreaves

WD My Cloud Home

I would recommend this device for families and small businesses who want one safe place to store all their important digital content and a way to easily share it with friends, family, business partners, or customers.

Featured Content

Product Launch Showcase

Latest Jobs

Don’t have an account? Sign up here

Don't have an account? Sign up now

Forgot password?