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Are California taxpayers ok with its home company charging $100 million more for the state university's computer network?

Are you a California taxpayer? If so, are you disturbed by the claims that San Jose-based Cisco Systems attempted to charge you $100 million more than its competitors for a computer network for your state university system?

Are you doubly concerned that San Jose State University decided to disengage from the state university system and acquire from Cisco anyway, even though there may be much less expensive alternatives available? SJSU said it "looked at the industry" before deciding to award Cisco the $28 million contract for its own network - it did not say it bid the project out, as virtually all state entities are required to do, including, apparently, those in California. In surfing around the CSU and SJSU websites, we found these pages and documents that detail the procurement process for CSU IT projects. 

Californians might recall a 2004 case in which an $8 million contract for the San Jose City Hall computer network was withdrawn after it was discovered that Cisco wrote portions of the bid.

Did the same thing happen with the SJSU project?

Some Network World readers are asking the same questions. These are some of the comments to our stories on the CSU/SJSU contracts:

If i were a taxpayer in the state of CA I would be asking some serious questions as to the use of state funds for projects that are apparently not as open as they should be.

So, Cisco tries to gouge the state of Calif. Calif says "no thank you." San Jose State Univ goes with Cisco anyway. It sounds like the president of San Jose State avoided the question about whether or not their project went out to bid... Isn't it against the rules for large state projects not to go out to bid?

As a technical person and a tax payer, I am appalled at SJSU's decision to disregard technical and financial wisdom. If I were an SJSU student, I would be asking this question:  How much are my fees being raised to pay for a project that technical experts agree can be done better and cheaper another way?

Full disclosure: that last comment was from a reader who claimed to work for CSU and reviewed the bids. There are even more comments expressing disbelief that the price delta between Cisco's proposal and that of winning bidder Alcatel-Lucent could be so wide, even after Network World was allowed to review the cost breakdowns of the bids and the proposed products. Some alleged that CSU may be short-changing its students:

CSU is cutting the student's education short and underestimating network use for the sake of saving money. How about looking at over-inflated salaries and pensions before cheapening the network infrastructure?

SJSU and other campuses are telling the Chancellor's office to take their almost bankrupt Alcatel and shove it!

Complete rubbish.  I have been involved in countless price comparisons that include the vendors involved here, and this is absurd... No company in the world would buy Cisco, if such a price discrepancy really existed.

We're interested in your reactions to these stories, especially if you're a California taxpayer. Do you feel things are on the up-and-up with a couple of the biggest and most influential companies and universities in your home state? Or does something not feel quite right with the way taxpayer monies are being spent or attempted to be obtained...

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