Cisco Sees Big Things Ahead For the Internet of Things

By Steve Anderson February 18, 2014

Though Cisco's earnings report wasn't exactly a barn-burner in its own right, CEO John Chambers still had plenty to offer in commentary on the future of both his firm and facing markets. Cisco appears to be quite enthusiastic about the future. Chambers offered up some commentary during a lunchtime keynote that came out with the earnings report, and suggested that the Internet of Things (IoT) -- which Cisco is very much in on as the Internet of Everything -- is poised to be a very big market.

So how big does Cisco believe the IoT market can get? By way of comparison, the United States' national debt is said to have recently cleared the $17 trillion mark. The IoT market will be bigger than that at fully $19 trillion in the next few years, by Chambers' reckoning. This is set to include $2.9 trillion devoted just to manufacturing, and that poises Cisco – which is very largely involved in the Internet of Things market as a whole -- to be at the start of what looks to be a major move. Recent reports from the company say that the IoT is set to be one of the biggest parts of Cisco's entire strategy.

But the keynote went beyond the IoT market, as impressive as that was, to note that Cisco is committed to building the Chinese market, a market that currently accounts for less than 5 percent of the company's overall business. Chambers noted that he had been following the region's trends and leaders “for decades,” and notes that there are some security issues that impact how Cisco can do business in that region.

Cisco also noted that the U.S. market is making a bit of a shift from compute-centric to network-centric operations, which makes sense given the rise of cloud computing and the various things being offered as a service. Software-defined networking (SDN) was also set to play a huge part in overall operations, as customers were looking for ways to reduce costs, and were likely to turn to SDN when it was recommended.

Earnings also played a major part in the call, with Chambers calling recent issues in earnings part of a “fluctuation” that's been known to happen. However, Chambers did acknowledge “...certain issues in wireless” that will be involved, and Chambers advised patience in the face of likely improvements in the short term.

It's a pretty impressive total market afoot, and the good news here is that it's likely to be so for some time to come. But it's still going to take some time for those numbers to fully come into play—some of those numbers have likely already emerged—and Cisco will have its work cut out for it getting fully into the growth part of the field. Cisco certainly has the product line to get it into the IoT market, but there's going to be a lot of competition, and taking a slice of the pie will only come at the end of a lot of hard work and a little luck. The focus on the growing Chinese market may help, but so too will bringing out tools for SDN use.

There's a lot of room in the IoT, and Cisco could be in line for a big chunk of it. Only time will tell, however, if Cisco can take territory here, and hold it as well.

Edited by Rachel Ramsey

Contributing IoTevolutionworld Writer

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