Cisco: From its Catalyst 6500 Ethernet switch rollout to 2011's 'transformation,' the networking giant has a rich history
Using terms like "transformation" and "reinvention," Cisco in 2011 embarks on a wrenching restructuring after years of torrid growth through acquisition and expansion into tens of adjacent markets. The rapid expansion hurt Cisco's core routing and switching businesses, and the company is forced to eliminate more than 12,000 Cisco jobs and cut nonessential product lines and markets, like the consumer-oriented Flip pocket videocam (pictured) and the Umi home TelePresence unit. The moves mark Cisco's re-engagement with, and dependence for future growth on, its core routing and switching businesses.
In 2004, Cisco introduces the Integrated Services Router -- better known as ISR -- for branch offices. ISR goes to become one of Cisco's most successful products, selling more than 7.5 million units in five years. Cisco follows up the first-generation ISR with the ISR G2 (pictured) in 2009.
Also in 2011, Cisco's effort to extradite a former employee to the U.S. from Canada to face hacking charges is denied by the Canadian court, which then accuses Cisco and U.S. authorities of duping Canada into arresting him. Peter Alfred-Adekeye (pictured) was arrested by Mounties in Vancouver while testifying in a countersuit that Cisco had filed after Alfred-Adekeye sued Cisco for anti-compeitive practices. But the British Columbia Supreme Court said Cisco orchestrated the arrest to intimidate Alfred-Adekeye from pursuing his antitrust case against the company.
Cisco is founded in 1984 by Sandy Lerner and Len Bosack, two married Stanford computer operations staffers. Bosack and Lerner adapt multiprotocol router software written by William Yeager, another Stanford researcher, for the first Cisco product and operating system.
Cisco makes its first and most significant acquisition in 1993 -- Ethernet switching startup Crescendo Communications. The purchase launches Cisco's $15 billion Catalyst switching business, and brings four important executives to the company: Mario Mazzola, Prem Jain, Luca Cafiero and Jayshree Ullal.
Cisco's stiffest competitor in service provider routing -- Juniper Networks -- is founded in 1996 by former officials from a company Cisco bought that year for $4 billion: fast packet switch maker StrataCom. Juniper has funding from several Cisco rivals -- including 3Com, Siemens/Newbridge and Northern Telecom -- and ships its first M-series router (pictured) in 1997. The company today is a $4 billion entity with a 30% share of the service provider core router market and 19% share at the edge, according to Dell'Oro Group.
Also in 1999, Cisco introduces what is perhaps its most important product since its first router: the Catalyst 6500 Ethernet switch. The 6500 becomes the cash cow of Cisco's $15 billion switching business and solidifies the company's dominance in enterprise networks. The Catalyst 6500 today has 25,000 customers and 700,000 chassis installed worldwide.
In addition to branch routing, core service provider routing is a watershed event in 2004 as well. Cisco introduces the CRS-1 system (pictured), which the company claims can support 1.2 terabits per second of bandwidth in a single system, but up to 92Tbps when 72 CRS-1 chassis are clustered through an optical interconnect. Cisco follows this up with the CRS-3 in 2010.
Also in 2009, Cisco is added to the Dow Jones Industrial Average, a listing of 30 major stocks selected to reflect the overall U.S. stock market. The listing is an indication of Cisco's influence on the overall economy, not just in technology.
Many major events have transpired over the first three decades of Cisco's existence since its founding in 1984 and the dominant position it now holds in networking as a $40 billion component of the Dow Jones Industrials. This slideshow compiles 19 of some of the more significant events.
Also in 2008, Cisco denies allegations that it is aiding the Chinese government in suppressing the Falun Gong movement. The allegations are connected to a 2002 PowerPoint document written by a Cisco engineer that refers to suppression of the Falun Gong religious group and "other hostiles." The document leads to two lawsuits against Cisco charging complicity with the Chinese government, charges that Cisco denies.
Cisco's first product, the AGS router, ships in 1986. The AGS -- for Advanced Gateway Server -- supports TCP/IP and PUP, among other protocols. The highest line rate on the system is 100Mbps FDDI.
Cisco celebrates the Dow designation and its entry into the blade server market by commemorating its 25th anniversary at the end of 2009. In 25 years, Cisco went from being a startup to a dominant presence in enterprise networking with annual revenue of $40 billion and a market capitalization of $132 billion (in 2009).
Cisco solidifies its leadership in Ethernet switching by acquiring Kalpana in 1994, a company credited with inventing Ethernet switching and the EtherChannel method of bonding together multiple link into a virtual high-bandwidth pipe. Cisco lands another important executive with this purchase -– Charlie Giancarlo, who during his 14 years at Cisco develops the company's acquisition strategy and leads several technology groups.
Pictured: Kalpana switch
John Chambers is named CEO in 1995, replacing John Morgridge (inset), who becomes Cisco chairman. Chambers oversees Cisco's growth from a $1 billion company in 1995 to the $40 billion behemoth it is today.
2008 sees another significant product introduced in an equally significant market for Cisco: the Nexus 7000 data center switch. The Nexus forms the core of Cisco's next-generation data center network, which will be designed to support a "fabric" for unified computing, networking and storage. It is intended to succeed the entrenched Catalyst 6500 in data center networks.
Cisco gets into voice networking in a big way in 1999 with its AVVID -- Architecture for Voice, Video and Integrated Data -- blueprint. Putting voice over IP packet-switched data networks will essentially make voice a free service on data networks, CEO Chambers asserts, and lead to network convergence that will save customers money and operational tasks. The AVVID strategy will usher in a Cisco product line of IP phones and PBXs.
Cisco goes public in 1990 and is listed on the NASDAQ stock exchange. The company's valuation at this time is $224 million.
Two key executives, both considered potential successors to CEO John Chambers, leave Cisco in 2007. Executive Vice President and Chief Development Officer Giancarlo (pictured), from the acquisition of Kalpana in 1994, leaves late in 2007; preceeded early in the year by Mike Volpi, the head of Cisco's Routing and Service Provider Technology Group. Both had been instrumental in Cisco's growth via acquisition from the mid-1990s to the mid-2000s.
Cisco hits another major product milestone and enters a new market in 2009 with the introduction of the Unified Computing System (UCS). UCS combines servers, switching, virtualization and storage access in an integrated system designed to unify the disparate elements of a data center. It marks Cisco's entry into the blade server market and essentially the end of its longtime partnerships with HP and IBM.
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