Open-source thorn in giant's sandal will slash prices to make up margin
Open-source networker Vyatta is once again offering discounts to customers based on Cisco’s make up margin — the percentage by which Cisco’s profit falls short of 100%. Since Cisco’s profit margin is usually in the mid-60s, Vyatta slashes the price of its appliances and subscriptions in the mid-30s.
Vyatta began this promotion a couple of quarters ago. This one will coincide with Cisco’s Q1 earnings, which we’ll all know on November 4.
Here’s Vyatta’s rationale for the promotion:
Cisco has one of the largest gross profit margins in the IT industry. Vyatta believes customers should have access to economically priced alternatives and open networking provides just that — all the functionality and performance at a fraction of the cost.
The discount will be offered November 4-18. It includes the newest version of the company’s open source router, firewall and VPN software. The new release is optimized for Citrix XenServer virtual environments and includes enhnacements to zone-based firewalling, IPv6, P2P traffic filtering, NAT and WAN load balancing, and QoS.
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