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30 events that shaped Cisco in 2011

Transformational year marked by layoffs, restructuring, killing Flip, heightened competition and humbling results

By , Network World
December 15, 2011 03:12 PM ET

Network World - 2011 was a tumultuously transitional year for Cisco. The company came to the realization that its strategy for growth by entering new markets spread it too thin, distracted it from core markets and impacted profits. It cost thousands of employees their jobs and forced Cisco to scale back on its aggressive growth plans and tactics. At the same time, Cisco became more aggressive in its sales and marketing, looking to protect and gain share against the likes of HP and Juniper while honing its structure to be more responsive to customers. These and several other events listed below helped define Cisco in 2011 and reshape it for the future:


• Upping the Internet TV ante with competitors Google, Microsoft and Apple, Cisco unveiled its Videoscape products and strategy at the Consumer Electronics Show. Videoscape is a cloud-based platform targeted at service providers looking to offer video services as a new revenue stream. It is designed to combine digital TV, online content, social media and other communications applications into an all-inclusive home and mobile video session.

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• Cisco reports a disappointing second quarter in which revenue and profits in Ethernet switching drop amid a challenging product transition and distraction from adjacent markets, like consumer.

• In an effort to streamline operations, Cisco names Gary Moore as its first chief operating officer, a post CEO John Chambers says he's been lobbying to fill for 10 years despite the coincidental timing with profitability issues.


• Cisco hosts its Partner Summit in New Orleans where CEO Chambers admits that the switching product transition issues caught the company by surprise.

• Also, word leaks out that Cisco is developing an additional fabric switch line to Nexus, under the code-name "Jawbreaker." Jawbreaker will use merchant silicon instead of custom ASICs, sources say, adding that it's a response to Juniper's QFabric launch.

• Later in the month, Cisco rolls out the Nexus 3000, a low latency top-of-rack switch based on merchant silicon for the high-frequency trading market.

• Cisco also pays its first ever cash dividend to shareholders.


• CEO Chambers issues a memo to staff stating that Cisco's lost focus, momentum and credibility after a couple of disappointing quarters. He acknowledges in the memo that Cisco is flawed, has failed to execute and been slow to make decisions over the past couple of quarters, and prepares employees for some major changes to come.

• Major changes do subsequently come, as Cisco restructures its consumer business, dropping the Flip video camera, dispersing its Eos media and entertainment operating system technology, merging its Umi consumer TelePresence system with its business TelePresence operations, and cutting 550 jobs.

• Cisco also implements a voluntary early retirement program, its first in two years, in an effort to cut positions and reduce expenses.

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