HP buying 3Com to take battle to Cisco

Commoditization would be beneficial to the business owner if it is in fact true that the innovation does not warrant the expense. It is true in many cases that it does and often late adopters may wish they had adopted a technology earlier ... that being said it would be entirely dependent on your situation. You sound like a smaller business and you have focused your attention on Cisco's enterprise product line which of course wouldnt be the right fit .. which is why Cisco has small business products with some of the easiest tools to roll out a complete SMB network from an intuitive GUI that is very easy to use.

And I think you are referring to Gross profit margin, which is not 80% ... actually 65% ... but of course that is Gross profit, and I am sure you know the difference between gross profit and net profit. I am sure Cisco has a healthy net profit margin, but probably not ridiculous. But more important than that is the actual value you are getting from your investment. Clearly given Cisco's market share, a lot of organizations feel that they are getting a good value ... there have ALWAYS been alternatives to Cisco's products yet most organizations have chosen Cisco, the only plausible explanation being that Cisco offered them a better value.

The 4500? The 4500 as you refer to it is a piece of sheet metal with modules in it. The modules contain all the brains and functionality of the switch ... the modules and every single measure of the performance of the device has changed constantly so your argument is completely wrong.

And it is not my argument that most innovation comes in the form of a, proprietary system it is 1. Self Evident 2. A nearly unanimously held opinion in the business community. 3. Easily demonstrable through an examination of pretty much any major innovation prior to its commoditization. There are a ton of ways to demonstrate this point, but just to choose one that relates to Cisco specifically ... Clearly, it takes a long period of time for a technology to move through a standards body, often several years. So which of these would you prefer: A. The technology cannot be implemented until it is standardized or B. Prestandard options are made available for customers that choose them ... Standards are then implemented when ratified. Option B is clearly the path that Cisco has taken the vast majority of the time, and it is clearly the path that makes more sense. Cisco submits the vast majority of its innovations to standards boards immediately, which is the case due to the maturity of the market and the buying power and leverage of Large Enterprise and service provider customers. The more disruptive the innovation and the more immature the market results in a longer time from innovation to standardization. To your point, innovation does continue to occur in standardized and commoditized products, like for example television sets, but not disruptive innovation or innovation that can lead to competitive differentiation, which is really where I am trying to get at with my previous comments.

And your comment that your engineers can only operate a Cisco proprietary protocol is beyond ridiculous. Please tell me which protocol this is because this statement is completely erroneous. It appears you are talking about the fact that there are a lot of engineers that are trained in how to operate Cisco devices? That has nothing to do with any proprietary protocol. Any device in any segment have differences ... different TV's come with different remote controls for example. There are multiple open source applications that do the same thing ... open source databases ... or say even open source routers like Zebra vs. Vyatta ... they are both open source but they still all require separate training. You are so bitter that you look at the fact that you can hire an engineer that is already pre-trained as a problem. In technology commoditization does not necessarily result in being able to easily be pre-trained in an application .. it actually usually means the opposite ... for example Zebra and Vyatta are not innovators in the networking space, they have a commodity feature set and are open source applications, but they are still specialized applications that require substantial training. Highly complex products are often commoditized ... Look at the enterprise PBX market up until a few years ago ... very commoditized, and extremely complex devices. The fact that Cisco has been smart enough to train people in getting educated in their products is just good business and it is good for the community ... in fact the vast majority of people who work on competitive products gained a large chunk of their know-how from Cisco. So with all of your whining about the fact that you can get employees that are pre-trained in Cisco you should realize that you have access to network engineers that have a lot of foundational training in networking concepts because of Cisco and whether you are a customer or not, as an employer you benefit from that. Generally the only time Cisco implements proprietary technologies is when a standard is not available and they generally start to work on standardizing their techs as soon as they are released. that being said the idea that companies should not have the right to capitalize on their own innovation is anti-capitalist. I would imagine that you have some form of competitive differentiation in your business whatever it may be. How would you respond if your customers told you had to train your competitors in your methods even though you spent a lot of time and money investing in your processes or technologies. Standards accelerate modularization and commoditization which can increase innovation in products that are already commoditized. But commoditization is also a deterrent to significant investment ... the investment made is always relative to the probability of success in a market and accordingly investment in R&D is much more limited in highly commoditized markets. In areas that are truly cutting edge there is generally a strong financial incentive that drives the investment in the research and development of the product. Would drug companies invest billions in developing new medicines or treatments if they went generic on day 1? Think of any disruptive tech and you tell me which one became a standard before it was released. There may be some examples but very few at best. I think perhaps you meant that open innovation can accelerate innovation, which is not the same as standardization ... proprietary interfaces can be open, and having strongly established market leaders like Cisco accelerates innovation in these cases. For example Microsoft opens API's to its partner community allows the partners to innovate around the open but proprietary architecture. Most software organizations do the same thing, and the innovation is most effective where there are clear market leaders. For example, if Cisco and Vyatta both release some API's to their partner communities, where do you think you will see more innovation occurring ... around the Cisco API's of course.