Cabletron: We'll go into service provider market when users tell us to

By Jim Duffy
Network World Fusion, 10/28/98

Cabletron Systems will let its enterprise customers dictate the company's move into the service provider market, said Cabletron CEO Craig Benson.

As users augment their enterprise network with public data services, they will pull Cabletron into deals with service providers and carriers, Benson said last week in an interview at the NetWorld+Interop show in Atlanta. Unlike its traditional competitors, Cabletron will not spearhead an effort to aggressively win carrier business, nor will it forsake its traditional customer base.

"Cabletron's philosophy is never go after new opportunities unless you make sure that you've covered your existing customer," Benson said. "The customer we have today is much more important than the customer we might have tomorrow."

Nevertheless, Cabletron does see some opportunities in the service provider arena as traditional enterprise customers take advantage of the Internet to offset from of the cost of operating a private network. Benson refers to this opportunity as "the new, emerging enterprise."

"(Users) want the same core services, features and benefits whether they own the asset or not," Benson said. "It's made us look outside the enterprise space into the next enterprise space to make sure we cover those bases as well."

Benson said this was an impetus behind Cabletron's acquisition of digital subscriber line (DSL) vendor FlowPoint and Ariel's Communications Systems Group last June. Cabletron also has 50 sales and marketing people focused on the "new, emerging enterprise" who are pitching the company's SmartSwitch Router, SmartSwitch 6000, and GigaSwitch products, in addition to the DSL wares.

Even so, Cabletron is not bullish on the Internet as the new, emerging enterprise. Benson said the Internet, in its current state, stifles innovation because it can't handle the voice and video traffic that make up two-thirds of a multiservice network that could unleash the true potential of the Internet as an e-commerce backbone.

"The Internet is a giant e-mail delivery system; it's a data delivery system," Benson said. "If we're really about convergence of voice, video and data, there's no good mechanism to run voice or video over the Internet at this point in time."

"The Internet is holding back innovation because...it's a bottleneck. It's slowing things down," he said. "I've had to dummy down my Web page in order for it to run on the Internet somewhat effectively. The Internet can't handle it."

Perhaps this is why Cabletron continues to focus on the private enterprise. Another reason might be the hardware churn Cabletron says its competitors force on their customers.

Cabletron recently launched the Smart Network Guarantee program in which it will support a competitor's product free for one year if a user can find a product that can outlive, outperform, and cost less than a comparable Cabletron device. Cabletron believes this program, along with the reliability and longevity of its wares, will win over new enterprise customers.

Cabletron is challenging its competitors to put the value of their products to the test.

"Return on investment or cost of ownership have been largely avoided by people in the networking business because it's to (vendors') benefit to get people to swap their products out every two or three years," Benson said. "Forced obsolescence is a fact of life not only in networking but in the technology business."

Benson said Cabletron is working with some market analysis firms and consultants to come up with ROI and cost of ownership metrics with which the industry can benchmark product reliability. He said these metrics and benchmarks are long overdue because data network infrastructures are becoming more like utility infrastructures - water mains and electricity distribution substations - and should last as long.

"The business now being 20 years old it's time to grow up and mature and have some standard metrics associated with it," Benson said. "By engaging customers in doing these things it'll force them to go back to their vendors and to their relationships and say, 'Well, how do you stack up vis-a-vis these things? Why aren't you helping me do more of this type of thing?'"