Skip Links

Cisco sees billions in smart buildings

Millions coming to new, old cities, necessitating infrastructure overhauls

By Jim Duffy on Fri, 06/18/10 - 3:45pm.

Cisco this week discussed Smart+Connected community initiatives in Vietnam and the Philippines with property developers on both countries. The deals are indicative of Cisco's focus on emerging markets as hotbeds for its 30 or so market adjacencies, of which Smart+Connected communities - or energy-intelligent office buildings and homes - is one.

Cisco believes that 700 million people will be added to cities around the world in the next five years and that by 2050, there will be a million residents in over 100 new cities. Fertile ground indeed for greenfield intelligent building/home opportunities.

Investment firm Ticonderoga Securities recently met with Cisco to discuss Smart+Connected communities opportunities and came away believing the market for Cisco could be billions over five years. In a bulletin on the meeting, the firm states:

We estimate a Smart+Connected Community contract can generate approximately 50% of revenues from Cisco's core routers and switches, while the remaining 50% stems from Advanced Technologies and services. Keep in mind, the current revenue generation from these 30+ adjacencies remains small, but the longer-term opportunity (3-7 years out) is significant, in our view. If some of these large market adjacencies pan out, we believe Cisco could approach $100 billion in revenue over the next decade.

The strategy is heavily partner-dependent though, Ticonderoga notes. They involve multipronged relationships with developers, cities and governments, on local, regional and perhaps countrywide levels. And while the benefits to Cisco are obvious, the company has to clearly articulate the gains to these partners on an environmental, economic and social level.

More from Cisco Subnet:

Advice for networking geek newbies

CCNP Shopping Spree – What to Buy?

Cisco gaining back switching share lost in 2009

Cisco, Avaya abstain from UC interoperability forum -- for now

Juniper takes more shots at Cisco in the data center

Win great stuff from Cisco Subnet Like e-mail? Subscribe to the Cisco Alert newsletter.
Like RSS readers? Subscribe to the Cisco Subnet RSS feed

Follow all Cisco Subnet bloggers on Twitter.
Follow Jim Duffy on Twitter