It’s been nearly one year since long-time Cisco CEO John Chambers stepped down to become the company’s executive chairman while Cisco veteran Chuck Robbins claimed the top job.Within that year, Cisco CSCO 0.47% has gone through many big changes including a reorganization of its management team, a group of influential engineers leaving the company, new data center hardware and analytics and security software products, and big partnerships with technology titans like Apple AAPL -0.56% , IBM IBM 0.62% , and Ericsson.
Oh, and the company made 15 acquisitions, including the more than $1 billion purchase of connected device software company Jasper, a $700 million acquisition of video conferencing company Acano, and a $260 million purchase of cloud software startup CliQr.
Needless to say, Robbins has had a busy year, and as he explained Wednesday during Fortune’s Brainstorm Technology conference, it’s not likely he’s going to be slowing down anytime soon.
Robbins simply can’t if Cisco wants to maintain its roughly $150 billion market cap amidst a rapidly changing technology landscape in which cloud computing giants like Amazon AMZN -0.73% and Microsoft MSFT 0.56% continue to grow while changing company purchasing habits continue to hurt legacy enterprise companies like Hewlett Packard Enterprise HPE -0.97% and IBM IBM 0.62% .
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Robbins explained that Cisco, like many legacy technology companies, is undergoing a “massive transition” to keep up with the changing marketplace.
It’s been nearly one year since long-time Cisco CEO John Chambers stepped down to become the company’s executive chairman while Cisco veteran Chuck Robbins claimed the top job.
Within that year, Cisco CSCO 0.47% has gone through many big changes including a reorganization of its management team, a group of influential engineers leaving the company, new data center hardware and analytics and security software products, and big partnerships with technology titans like Apple AAPL -0.56% , IBM IBM 0.62% , and Ericsson.
Oh, and the company made 15 acquisitions, including the more than $1 billion purchase of connected device software company Jasper, a $700 million acquisition of video conferencing company Acano, and a $260 million purchase of cloud software startup CliQr.
Needless to say, Robbins has had a busy year, and as he explained Wednesday during Fortune’s Brainstorm Technology conference, it’s not likely he’s going to be slowing down anytime soon.
Robbins simply can’t if Cisco wants to maintain its roughly $150 billion market cap amidst a rapidly changing technology landscape in which cloud computing giants like Amazon AMZN -0.73% and Microsoft MSFT 0.56% continue to grow while changing company purchasing habits continue to hurt legacy enterprise companies like Hewlett Packard Enterprise HPE -0.97% and IBM IBM 0.62% .
Get Data Sheet, Fortune’s technology Part of that change involves shifting from merely selling routers and switches to a software subscription model in which Cisco can sell data and security analytics services to companies on a reoccurring basis, Robbins said. This type of software-focused business model will help Cisco better predict future revenues, he explained.
As an example, he cited Cisco’s work with Japanese robotics company FANUC to connect car assembly robots to a cloud network in some of General Motors’s manufacturing plants. GM @ GM 0.10% can spot errors with their robots before they become major problems due in part to the cloud network and related analytics tools that tethers the robots together.
“The connectivity of that robot means absolutely nothing until you build the analytics capability,” Robbins said.
Robbins explained that Cisco, like many legacy technology companies, is undergoing a “massive transition” to keep up with the changing marketplace.
Still, areas like security and data analytics are relatively new for Cisco, and Robbins admitted that the company “had times in our history where we probably got a little bit too broad” with their products.
“Everyone always wants to talk about Flip,” Robbins joked in reference to Cisco’s failed foray into cameras that came from its $590 million purchase of camcorder maker Pure Digital Technologies in 2009. Robbins quoted his predecessor Chamber’s take on the flop and said, “If that was the worst mistake we made, then that’s OK.”
Although sales of data center hardware like servers and routers decline, Robbins said that “high-performance hardware” is not “going away any time soon,” because all of the Internet and related software needs hardware to function.
Still, the question is whether companies will continue to purchase Cisco hardware or its competitor’s gear, whether from giants like EMC EMC -0.29% and Dell or so-called white box gear from Taiwanese companies like Quanta, for example.
Robbins dismissed the notion of white-box vendors and other competitors eating into its sales and said Cisco’s “gross margins are higher than they have been in two-to-three years.”
Additionally, many analysts have claimed that Cisco’s business could be impacted by big web companies like Facebook that have been developing their own data center switches and gear because of the perception that traditional hardware vendors don’t offer them the capabilities they require. Robbins said Cisco is working with these “large webscale players” to address their needs, but he did not name any specific companies.
Regarding Dell and its massive still-in-progress $59 billion acquisition of EMC, Robbins said, “I think it’s obviously a complex transition; I think that’s intuitively obvious.”
Although Cisco competes with Dell and EMC, after the acquisition closes, Robbins said Cisco may look for ways to partner with the yet-to-be formed Dell Technologies. The rapidly changing technology landscape has given rise to blockbuster partnerships between competitors who need each other’s strengths in order to satisfy customers, Robbins explained.
The world is “moving too fast for anyone of us to do it all alone,” Robbins said.
