The Competition of Cisco

Cisco has completed the restructuring, declares war to the competition. If previously evaluated Cisco increased its profitability in the coming years at the level of 9-12% per year, but now, the returns fell to 5-7% per year. Cause of decreasing profit, is precisely, the increased competition in the market.

During past 10 years Cisco dominate the market for computer networks. However, aggravated struggle with competitors, especially: Juniper Networks, Huawei Technologes it became the main reason for relief positions Cisco.

Reducing the 13 thousand employees in Mexico and sold his business of manufacturing camcorders Flip Video, Cisco has focused on its core business.

The head of the company Cisco John Chambers, held as soon as possible restructuring of the company, and this gives us confidence that the volume of gross margin will not fall below 60%.

A few years ago, Cisco was forced to reduce the prices of their products, immediate impact on reducing the market share. But analysts predict the recurrence of such a step back, because this is not inevitably in opposition to the competition.

Cisco managed to create for themselves a clear vision of development and define it by area. Directions will be reduced, and there are over 10, with Cisco goes completely or reduce their presence. In areas such as security, mobile Internet, servers and access, network virtualization, cloud systems management, software and television presence, Cisco, on the contrary will increase their capacity.