Cisco Continues to Bet on Partnerships in the Storage Space



Tremendous success with partnering strategy

Cisco sells its UCS (Unified Computing System) products through a joint venture with EMC (EMC) and VMware (VMW). This joint venture is called VCE. The companies created it with the vision of establishing a converged infrastructure for data center consolidation, SaaS (software-as-a-service), and the cloud-computing market.

VCE offers enterprise IT (information technology) solutions using technologies from VMware’s computing, Cisco’s networking, and EMC’s storage.

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At the Goldman Sachs (GS) Technology and Internet Conference, Cisco’s (CSCO) CEO Chuck Robbins said, “We’ve had tremendous success with our partnering strategy. Here it’s been phenomenal and the VCE joint venture that we built in the Vblock business that we built, it’s still accelerating and we haven’t seen any significant shift in that momentum.”

With the help of UCS products, Cisco saw strong revenue growth in its Data Center segment.

Partnership with NetApp

Cisco also partnered with NetApp (NTAP), where it sells products under the name FlexPod. FlexPod products are essentially a combination of Cisco’s UCS and NetApp’s FAS (Fabric-Attached Storage) products.

Huge growth expected in the converged infrastructure space

According to the International Data Corporation, total worldwide spending on converged infrastructure is growing at a rate of over 30% annually. Analysts expect this figure to reach approximately $14 billion in 2017 compared to $5.4 billion in 2013 and $7 billion in 2014.

Cisco accounts for 2.4% of the Power Shares QQQ Trust, Series 1 ETF (QQQ).


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