 "At the request of another federal government agency, on January 11, 2008, the FBI's Cyber Division provided an unclassified PowerPoint presentation and briefing on efforts to counter the production and distribution of counterfeit network hardware," said James Finch - Assistant Director FBI Cyber Division.
"This unclassified briefing was never intended for broad distribution or posting to the Internet." |
"This presentation discussed cyber threats including Operation Cisco Raider."
Actual slides from the FBI presentation:
Yours truly was stunned to see that the FBI's presentation was partly based on a Network World story published October 23rd, 2006:
The FBI even printed the web page URL address of the Network World story:
http://www.networkworld.com/news/2006/102306counterfeit.html
On the bottom right of the slide directly below:
Even more stunning to yours truly, was the blog entry published on The Platform - The Official Cisco Blog, in reaction to the unauthorized public release of the FBI PowerPoint presentation:
Cisco Statement on Counterfeit Goods
"So what can you do? We can’t stress enough the importance to Cisco customers and channel partners of procuring equipment only from Cisco authorized channels."
Yours truly was even more flabbergasted that the FBI presentation specifically pointed out that it was a Cisco authorized reseller, Atec Group Inc., which sold 30 counterfeit Cisco WAN Interface Cards (WIC) to the Cisco customer MortgageIT.
From the October 23rd, 2006 Network World story:
"Thirty cards turned out to be counterfeit, he says."
"Despite repeated calls and e-mails to his supplier, Atec Group Inc., the issue was not resolved."
The January 11th, 2008 FBI presentation also highlighted the FBI's problems with Cisco.
According to the FBI, one of its problems was in fact Cisco's solution:
Use Cisco Silver and Gold Partners
In the very next slide directly below, the FBI presentation stated that the Government's problem is that Cisco Gold/Silver partners are selling counterfeit gear to government and defense contractors.
Furthermore, the FBI presentation slide directly below clearly states another problem is that Cisco Brand Protection does NOT coordinate with Cisco's Government Sales.
So what has Cisco done about their authorized reseller, the Atec Group Inc. selling counterfeit Cisco?
Almost nineteen months after the Network World story, and more than four months after the FBI presentation, the Atec Group Inc. is still an authorized Cisco reseller:
Do YOU agree with the FBI presentation above that Cisco Gold/Silver Partners are one of the problems with counterfeit Cisco being sold to government and defense contractors?
In a recent featured article on pages 70 thru 77 of synnovation magazine published by EDS (soon to be HP), Cisco elaborates on the life cycle phases of strategic alliances.
 "If one partner feels ignored or underserved, the alliance will suffer later," said Simon Hayes - Cisco Vice President Enterprise Strategic Alliances.
"An alliance is no place to win a negotiation to the detriment of your partner." "Like any other business relationship, strategic alliances require good governance to succeed." |
Every alliance goes through a natural life cycle.
The Alliance Life Cycle:
| Phase 1: Evaluate | |
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Define alliance strategy |
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Analyze portfolio |
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Evaluate ecosystem |
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Evaluate partner |
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Build business case |
| Phase 2: Form | |
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Create partnering value proposition |
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Secure sponsors |
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Conduct negotiations and forge agreements |
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Protect intellectual property |
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Announce alliance |
| Phase 3: Incubate | |
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Structure alliance governance |
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Build operational model |
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Plan communications |
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Create partner-engagement model |
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Launch new alliance marketing |
| Phase 4: Operate | |
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Build executive committees and boards |
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Conduct business planning |
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Draft alliance solutions and initiatives |
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Create field engagement and marketing |
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Define metrics and performance reporting |
| Phase 5: Transition | |
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Review strategy and value proposition |
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Review value curves and trends |
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Update strategic goals |
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Confirm joint commitment |
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Determine future investment |
| Phase 6: Retire | |
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Conduct management discussions |
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Determine exit strategy |
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Build exit plans |
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Define activities and timeline |
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Create messaging |
What has been YOUR experience while in a strategic alliance with Cisco?
Top 25 Network Problems and Their Business Impact:
| 1. | Configuration not saved
Reboot will cause config to be lost |
| 2. | Saved configurations don’t meet corporate policy
Source of many problems from performance to reliability to security |
| 3. | Bloated firewall rule set; unused ACL entries
Poor firewall performance Open, unused rules, creating potential security problems |
| 4. | Firewall connection count exceeded
New connections via the firewall fail Business applications exhibit intermittent failure at high firewall loads VPNs begin to fail |
| 5. | Link hog - someone downloading music or videos
Slower application response, impacting user productivity |
| 6. | Interface traffic congestion
Unpredictable application performance, impacting user productivity |
| 7. | Link problems & stability
Physical or DataLink errors cause slow or intermittent application performance Link or interface stability can impact routing and spanning tree (see other examples) |
| 8. | Environmental limits exceeded
Fan failure, power supply problems, and high temperatures are indicators of problems that will likely cause a network device to reboot, affecting any applications relying on the device |
| 9. | Memory utilization increasing
A bug in the device’s operating system is consuming more memory and when no free memory exists, the device will reboot, disrupting applications that are transiting the device |
| 10. | Incorrect serial bandwidth setting
Causes routing protocols to make non-optimum routing decisions |
| 11. | No QoS
Important business applications are not prioritized, yielding unpredictable or poor performance during times of interface congestion |
| 12. | QoS Queue Drops
Important business applications are slow Business needs may have changed since the queue definitions were created VoIP is especially affected by this problem |
| 13. | Route flaps
Poor application performance as packets take the wrong or inefficient paths in the network |
| 14. | OSPF recalculations high
Routing protocol unstable; poor and inconsistent application performance |
| 15. | Poor VoIP quality
Due to high jitter, delay, or packet loss Choppy voice calls Calls mysteriously disconnect |
| 16. | Routing Neighbor changes high
Applications using paths via this router will be unstable or slow Affects OSPF, EIGRP, and BGP |
| 17. | OSPF area not connected to backbone
The disconnected OSPF area will not be reachable from other OSPF areas, impacting applications that need to communicate between areas |
| 18. | Unidirectional traffic flow
Typically the result of misconfigured routing Slower applications, strange failure odes, and complex troubleshooting due to asymmetric routing |
| 19. | Router interface down
Any router interface marked administratively up but is operationally down is likely to be a redundant connection that will cause an outage if the other connection also fails, affecting all applications that use it |
| 20. | Unstable root bridge
Bridge priority not set; applications quit working over unstable VLANs |
| 21. | Duplex mismatch
Increasing link errors Applications get slower as traffic volume increases |
| 22. | Downstream hub or switch
Unauthorized devices added to the network Compromise to network integrity and security See 20, Unstable Root Bridge |
| 23. | Port in ErrDisable state
The set of end stations connected via this port are disconnected from the network until the port is enabled (either automatically or by user control) |
| 24. | Unbalanced & unused etherchannels
Increased latency & jitter affecting sensitive applications like VoIP Compromised redundancy |
| 25. | HSRP or VRRP peer not found
Redundancy configured and not operating correctly Outage when a second failure occurs Redundancy compromised |
Free Poster:
The above network problems are available as a snazzy FREE poster (ordered mine) that is suitable for office display and framing, it details the top 25 network problems that Netcordia's NetMRI detects.
It's a great resource for communicating between managers and technical staff, as it illustrates the business impact of common network problems.
What do YOU think is a top network problem?
 Terry Slattery who earned the world's first CCIE on August 3rd 1993, Number 1026 Routing and Switching, recertified earlier this month by passing the written (350-001).
Terry's CCIE Number had been under suspended status and his personal challenge, like many other long-term CCIEs, is that his current job is far removed from daily operations, which is what the CCIE test measures. Terry had not kept up with several of the newer technologies, so he had a fair amount of studying to do. |
To prepare, Terry used TestiT, a written testing system created by NetMasterClass.
Their written test questions focused Terry on the areas of technology that he needed to study.
Terry didn't take the approach of studying to the test - he took the approach of learning the technology that was covered by the questions.
When Terry encountered a question that he answered incorrectly, he read their solution summmary and used their reference links to read up on the technology:
That approach obviously worked, since Terry passed the recertification written test Monday, May 5th 2008.
Terry highly recommends NetMasterClass's written testing tools to help you focus on the technology you need to know.
And he believes they are great folks since they've been teaching CCIE prep classes for many years, going back to the days when Chesapeake was a Cisco training partner (Terry was a cofounder of Chesapeake).
The CertGUARD CertSearch Tool has classified over 1,800 certification websites to help you determine which sites are braindumps and which are safe to use.
CertGUARD ranks Terry's CCIE written testing system recommendation created by NetMasterClass.com as SAFE:
View the history of the very first CCIE.
Are YOU a CCIE whose current job is far removed from daily operations, if so, how did YOU study to earn your CCIE recertification?
Network World recently ran a blog post in Cisco Subnet that examined Cisco financials and concluded that an increase in the third quarter accounts receivable increase, a dip in the net sales increase and an increase in Days Sales Outstanding added up to channel stuffing, and we suggested:
Cisco was cooking the books.
This was supposition based solely on an interpretation of the numbers and, while Cisco didn't argue with the numbers, it refuted our conclusion and we apologize for the accusations.
According to Cisco:
"Cisco employs conservative policies regarding revenue recognition."
"For example, in our distribution channel, Cisco does not recognize revenue until product leaves our channel partner, effectually removing any possibility of recognizing revenue before it’s sold to the end customer."
My sincere apology to Cisco,
Cisco has $10.1 million in contracts with the State of Pennsylvania.
So after five state employees returned from a Harrisburg, PA tech conference with door prizes sponsored by Cisco (an iPod, $50 gift cards and free software), they were told to return the gifts.
The State of Pennsylvania has a management directive regarding gifts:
| Employees and the families of employees shall not directly or indirectly solicit, accept or agree to accept any gift of money or goods, loans or services for personal benefit under any circumstance which would influence the manner in which employees perform their work, make their decisions or otherwise perform their duties. |
The above directive appears to undermine official Cisco policy:
| Cisco policy allows gifts to be awarded to government employees if distributed as door prizes in a random drawing. |
Do YOU agree with the State of Pennsylvania that Cisco door prizes give the appearance of impropriety?
The December 2007 Cisco development organization (CDO) chart below has a striking resemblance to Swiss cheese, now that a second member, Jayshree Ullal - Cisco SVP Data Center Switching & Services, has announced her exit from Cisco (the first Cisco CDO member to leave was Charlie Giancarlo).
 Ullal's succession has been in the works for a while, so it's not a jumping ship kind of thing. She's leaving, taking the summer off, and then most likely going to start something up (view Ullal's Cisco blog announcement). Doubtful it will be Nuova like. Is Cisco becoming too unwieldy? |
Why do YOU think Jayshree Ullal is leaving Cisco?
BradReese.Com Cisco Resumes received an updated resume late this afternoon that featured a new Cisco CCIE No. 20723 Routing and Switching certification, that was earned on May 7th, 2008.
This new CCIE's career objective:
To obtain a challenging position in high-end IT infrastructure design, deployment, analysis, support and information security as Team Leader or Senior Network/Pre-Sales Consultant in a career rewarding company which will allow personal and professional growth without limiting the opportunity for further enlightenment and enhanced education.
View this new CCIE's Cover Letter
View this new CCIE's CV/Resume
Almost exactly a month ago (April 6th, 2008), we received an updated resume that featured Cisco CCIE No. 20450 Routing and Switching.
New Cisco CCIE certificates are currently being awarded at the rate of 273 per month.
As of May 7th, 2008 - 19,699 CCIE certificates have been awarded during the entire history of the Cisco CCIE program.
| 20723 - CCIE Number as of May 7th, 2008
1024 - Beginning CCIE Number issued August 1993 19,699 - CCIE Numbers issued in the entire Cisco CCIE Program |
Of course, not all CCIEs have re-certified, many have allowed their CCIE Numbers to become inactive (meaning that they have to start from scratch and retake the CCIE written exam as well as the CCIE lab exam all over again in order to recapture their CCIE certification status).
Finally, the Cisco CCIE Resources Worldwide web page continues to be out-of-date.
What number do YOU think your future CCIE certificate will have on it?
It's been an interesting few days since I posted my commentary on Cisco's third-quarter results.
Yours truly pointed out that Cisco's 3rd Qtr 2008 accounts receivable increase was $20 million more than the corresponding increase in net sales when compared to the Cisco 3rd Qtr 2007, and questioned if this indicated that Cisco is channel stuffing (in fact, I'll admit, I did more than question, I more-or-less insisted).
My interpretation of the third-quarter results was based on Cisco's financial reports and was not based on evidence from specific channel partners.
Last night, the Cisco Director of Corporate Communications met with yours truly and Network World editor-in-chief John Dix to discuss the issue.
Cisco did not take exception to any of the data, but argued with my interpretation of those numbers. The spokesperson insisted channel stuffing is impossible at Cisco because the company doesn't book revenue until it leaves the reseller, and said the increase in accounts receivable compared to the increase in net sales is explained by long-term service contracts in which revenue shows up on the books over many quarters.
Because I lack first-hand accounts, and because Cisco has offered an alternative explanation, I have agreed to tone down my opinion.
Am editing this original post and any subsequent comments to remove direct accusations of channel stuffing, while leaving the numbers, the analysis and all the other comments up for you to make up your own minds.
Official response from Cisco:
Cisco Statement on Recent Network World Blog Post
5 Year Comparison Cisco 3rd Qtr Financial Numbers (In Millions)
| Cisco 3rd Qtr for the Year | 2008 | 2007 | 2006 | 2005 | 2004 |
| Net Sales Increase | $925 | $1,544 | $1,135 | $567 | $1,002 |
| Accounts Receivable Increase | $945 | $258 | $739 | $701 | $383 |
| Days sales outstanding in accounts receivable (DSO) |
39 | 33 | 36 | 33 | 27 |
5 Year Cisco 3rd Quarter (In Red) Stock Chart
According to the Cisco 3rd Qtr 2008 earnings call transcript, no explanation was given for the reason the increase in accounts receivable was $20 million more than the corresponding increase in net sales when compared to the Cisco 3rd Qtr 2007.
Why?
The single mention of accounts receivable in the earnings transcript:
|
Moving on to accounts receivable, we ended the quarter at $4.2 billion which was flat from Q2.
At the end of Q3, day sales outstanding or DSO was 39 days the same as was in Q2. Both Q2 and Q3 include the effect of several large multi-year service agreements, which has increased the DSO in each quarter by three to four days. |
Cisco 3rd Qtr 2008 Earnings Call Transcript
What is most alarming to yours truly, is how Wall Street Analysts could ignore such a huge red flag.
Related story:
Is Cisco Unloading To Pump Up The Numbers?
Official response from Cisco:
Cisco Statement on Recent Network World Blog Post
5 Year Comparison Cisco 4th Qtr Financial Numbers (In Millions)
| Cisco 4th Qtr for the Year | 2008 | 2007 | 2006 | 2005 | 2004 |
| Net Sales Increase | - | $1,449 | $1,403 | $655 | $1,224 |
| Accounts Receivable Increase | - | $686 | $1,087 | $391 | $474 |
| Days sales outstanding in accounts receivable (DSO) |
- | 38 | 38 | 31 | 28 |
5 Year Comparison Cisco 3rd Qtr Financial Numbers (In Millions)
| Cisco 3rd Qtr for the Year | 2008 | 2007 | 2006 | 2005 | 2004 |
| Net Sales Increase |
