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Cisco losing share across the board: analyst

By Jim Duffy on Mon, 06/08/09 - 2:47pm.

Cisco lost share across several markets in Q1, most dramatically in SANs, according to investment firm UBS. The firm suggests the backwards steps might be due to company distraction.

In a bulletin this week, UBS notes that early trends in 2009 show Cisco losing market share across virtually all product segments, "possibly due to distractions within the company" as well as increased competition. "Niche" markets were the hardest hit, the firm states -- Layer 4-7 switching, WAN optimization and SAN switching.

Dell'Oro Group believes the hit in SANs is due to Cisco "channel conflict" -- a reference to its entry into the server domain of HP and IBM. In core routers, it was a rather downcast birthday party for the CRS-1.

UBS indicates the distractions might be Cisco's ambitious moves into emerging new markets while neglecting existing ones:

SAN performs worst w/ new data center dynamics possible. Cisco entering ~30 mkt adjacencies and reallocating ~$1.0B of its workforce.

Huawei could be the leading competitive culprit. UBS notes the Chinese giant has been extending share gains from the last several years, due to strong 3G wireless spending in China, among other factors.

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