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1982–1995: early years
Cisco Systems was founded in December 1984 by two members of
Stanford University computer support staff:
Leonard Bosack who was in charge of the computer science department's
computers, and
Sandy Lerner, who managed the Graduate School of Business' computers.
Despite founding Cisco in 1984, Bosack, along with Kirk Lougheed, continued
to work at Stanford on Cisco's first product which consisted of exact replicas
of Stanford's "Blue Box" router and a stolen
[5]
copy of the University's multiple-protocol
router software, originally written some years earlier at Stanford medical
school by
William Yeager - a Stanford research engineer — which they adapted into what
became the foundation for
Cisco IOS.
On July 11, 1986, Bosack and Kirk Lougheed were forced to resign from Stanford
and the University contemplated filing criminal complaints against Cisco and its
founders for the theft of its software, hardware designs and other intellectual
properties. In 1987, Stanford licensed the router software and two computer
boards to Cisco.
In addition to Bosack, Lerner and Lougheed, Greg Satz, a programmer, and
Richard Troiano, who handled sales completed the early Cisco team. The company's
first CEO was Bill Graves, who held the position from 1987 to 1988.
[6]
In 1988,
John Morgridge was appointed CEO.
The name "Cisco" was derived from the city name, San Francisco, which is why
the company's engineers insisted on using the lower case "cisco" in the early
days.
On February 16, 1990, Cisco Systems went public (with a market capitalization
of $224 million) and was listed on the
NASDAQ stock
exchange. On August 28, 1990, Lerner was fired; upon hearing the news, her
husband Bosack resigned in protest. The couple walked away from Cisco with
$170 million, 70% of which was committed to their own charity.
[7]
Although Cisco was not the first company to develop and sell dedicated
network nodes,
[8]
it was one of the first to sell commercially successful routers supporting
multiple network protocols.
[9]
Classical, CPU-based architecture of early Cisco devices coupled with
flexibility of operating system
IOS
allowed for keeping up with evolving technology needs by means of frequent
software upgrades. Some popular models of that time (such as
Cisco 2500) managed to stay in production for almost a decade virtually
unchanged—a rare sight in high-tech industry. Although Cisco was strongly rooted
in the enterprise environment, the company was quick to capture the emerging
service provider environment, entering SP market with new, high-capacity product
lines such as Cisco 7000 and Cisco 7500.
Between 1992 and 1994, Cisco acquired several companies in Ethernet
switching, such as
Kalpana, Grand Junction, and most notably, Mario Mazzola's Crescendo
Communications which together formed the
Catalyst business unit. At the time, the company envisioned
layer
3 routing and
layer 2 (
Ethernet,
Token Ring) switching as complementary functions of different intelligence
and architecture—the former was slow and complex, the latter was fast but
simple. This philosophy dominated the company's product lines throughout 1990s.
In 1995,
John Morgridge was succeeded by
John Chambers.
[10]
1996–2009: Internet and silicon intelligence
The phenomenal growth of the Internet in mid-to-late 1990s quickly changed
the telecom landscape. As the
Internet Protocol (IP) became widely adopted, the importance of
multi-protocol routing declined. Nevertheless, Cisco managed to catch the
Internet wave, with products ranging from modem access shelves (AS5200) to core
GSR
routers that quickly became vital to Internet service providers and by 1998 gave
Cisco de facto monopoly in this critical segment.
In late March 2000, at the height of the
dot-com bubble, Cisco became the most valuable company in the world, with a
market capitalization of more than US$500 billion.
[11][12]
In November 2011, with a market cap of about US$94 billion,
[13]
it is still one of the most valuable companies.
[14]
Meanwhile, the growth of Internet bandwidth requirements kept challenging
traditional, software-based packet processing architectures.
The perceived complexity of programming routing functions in silicon, led to
formation of several startups determined to find new ways to process
IP and
MPLS packets entirely in hardware and blur boundaries between routing and
switching. One of them,
Juniper Networks, shipped their first product in 1999 and by 2000 chipped
away about 30% from Cisco SP Market share. Cisco answered the challenge with
homegrown
ASICs and fast processing cards for
GSR
routers and
Catalyst 6500 switches. In 2004, Cisco also started migration to new
high-end hardware
CRS-1 and software architecture
IOS-XR.
2006–2012: The Human Network
As part of a massive rebranding campaign in 2006, Cisco Systems adopted the
shortened name "Cisco" and created "The Human Network" advertising campaign.
These efforts were meant to make Cisco a "household" brand—a strategy designed
to support the low-end Linksys products and future consumer products (such as
Flip Video
camera acquired by Cisco in 2009).
On the more traditional business side, Cisco continued to develop its
extensive enterprise-focused routing, switching and security portfolio. Quickly
growing importance of
Ethernet
also influenced the company's product lines, prompting the company to morph the
successful Catalyst 6500 Ethernet switch into all-purpose Cisco 7600 routing
platform.
[15]
However, limits of
IOS and
aging Crescendo architecture also forced Cisco to look at merchant silicon in
the carrier Ethernet segment. This resulted in a new
ASR9000
product family intended to consolidate company's carrier ethernet and subscriber
management business around
EZChip-based hardware and
IOS-XR. Cisco also expanded into new markets by acquisition—one example
being a 2009 purchase of mobile specialist
Starent Networks that resulted in ASR5000 product line.
A Cisco base in
Chennai,
India.
India is one of the company's largest overseas markets and
production centers.
Throughout the mid-2000s, Cisco also built a significant presence in India,
establishing its Globalization Centre East in
Bengaluru for $1 billion, and planning that 20% of Cisco's leaders would be
based there.
[16]
However, Cisco continued to be challenged by both domestic
Alcatel-Lucent,
Juniper Networks and overseas competitors
Huawei. Due to
lower-than-expected profit in 2011, Cisco was forced to reduce annual expenses
by $1 billion. The company cut around 3,000 employees with an early-retirement
program who accepted buyout and planned to eliminate as many as 10,000 jobs
(around 14 percent of the 73,400 total employees before curtailment).
[17][18]
During the 2011 analyst call, Cisco's CEO John Chambers called out several
competitors by name,
[19]
including Juniper and HP.
On 24 July 2012, Cisco received approval from the EU to acquire NDS (a TV
software developer) for USD 5 billion.
[20]
This acquisition signaled the end of the "The Human Network" strategy as Cisco
found itself backing off from household hardware like Linksys
[21]
and Flip into the cloud and software solutions.
2013–Present: The Internet of Everything
Cisco launches its first global re-branding campaign for the first time in
six years with its "TOMORROW starts here" and "Internet of Everything"
advertising campaigns. These efforts were designed to position Cisco for the
next ten years into a global leader in connecting the previously unconnected and
facilitate the
IP address
connectivity of people, data, processes and things through
cloud computing applications and services.
On July 23, 2013, Cisco Systems announced a definitive agreement to acquire
Sourcefire
for $2.7 billion.
[22]
Media and awards
Cisco products, most notably IP phones and Telepresence, are frequently
sighted in movies and TV series.
[23]
The company itself and its history was featured in the documentary film
Something Ventured which premiered in 2011.
Cisco was a 2002–03 recipient of the
Ron Brown Award,
[24][25]
a U.S. presidential honor to recognize companies "for the exemplary quality of
their relationships with employees and communities". Cisco commonly stays on top
of Fortune "100 Best Companies to work for", with position No. 20 in 2011.
[26]
Acquisitions
Cisco acquired a variety of companies to spin products and talent into the
company. In 1995–1996 the company completed 11 acquisitions.
[27]
Several acquisitions, such as
Stratacom, were the biggest deals in the industry when they occurred.
[28]
During the Internet boom in 1999, the company acquired
Cerent Corporation, a start-up company located in
Petaluma, California, for about US$7 billion.
[29]
It was the most expensive acquisition made by Cisco to that date, and only the
acquisition of
Scientific Atlanta has been larger.
[30]
Several acquired companies have grown into $1Bn+ business units for Cisco,
including LAN switching, Enterprise
Voice over Internet Protocol (VOIP) platform
Webex, and
home networking. The latter came as result of Cisco acquiring
Linksys in
2003 and in 2010 was supplemented with new product line dubbed
Cisco Valet. Cisco announced on March 15, 2012 that it is acquiring
NDS Group
for $5B.
[31][32]
This transaction was completed on July 30, 2012.
[2][3]
In the recent merger deals, Cisco bought Starent Networks (a mobile packet
core company) and Moto Development Group, a product design consulting firm that
helped develop Cisco's Flip video camera.
[33][34]
Also in 2010, Cisco became a key stakeholder in
e-Skills Week. In March
2011, Cisco completed the acquisition of privately held network configuration
and change management
solutions
company Pari Networks.
[35]
Although many buy-ins (such as Crescendo Networks in 1993,
Tandberg in
2010) resulted in acquisition of flagship technology to Cisco, many others have
failed—partially or completely.
[36]
For instance, in 2010 Cisco occupied a meaningful share of the packet-optical
market,
[37]
revenues were still not on par with US$7 billion price tag paid in 1999 for
Cerent. Some of acquired technologies (such as Flip from Pure Digital) saw
their product lines terminated.
[38][39]
In January 2013, Cisco Systems acquired Israeli software maker Intucell for
around $475 million in cash, a move to expand its mobile network management
offerings.
[40][41]
In the same month, Cisco Systems acquired Cognitive Security, a company focused
on Cyber Threat Protection. Cisco also acquired SolveDirect(Cloud Services) in
March 2013 and Ubiquisys(Modile Software) in April 2013.
Products and
services
Cisco's current portfolio of products and services is focused upon three
market segments—Enterprise and Service Provider, Small Business and the Home.
The
solutions
for each market are segmented into Architectures, which form the basis for how
Cisco approaches each market.
Corporate market
Corporate market refers to enterprise networking and service providers.
- Borderless networks
-
[42] for their range of routers, switches, wireless systems,
security systems, WAN acceleration, energy and building management systems
and media aware networks.[43]
- Collaboration
- IP video and phones, TelePresence, HealthPresence, Unified
Communications, Call Center systems, Enterprise social networks and Mobile
applications[44]
- Datacenter and Virtualization
- Unified Computing, Unified Fabric, Data Centre Switching, Storage
Networking and
Cloud Computing services.[45]
- IP NGN (Next Generation Networks)
- High-end routing and switching for fixed and mobile service provider
networks, broadcast video contribution/distribution, entitlement and content
delivery systems.[46]
Small businesses
Small businesses include home businesses and (usually technology-based)
startups.
[47]
- Routers and switches
- The machines that route and redirect packets across a network, including
those for networks of smart meters.[48]
- Security and surveillance
- IP cameras, data and network security
solutions,
etc.[49]
- Voice and conferencing
solutions
-
VOIP phones and gateway-systems, WebEx, video conferencing
- Wireless
- WiFi Access points
- Network storage systems
- Persistent storage on networks, either in the traditional sense or in a
cloud-like manner.
Home user
Home user refers to individuals or families who require these kinds of
services.
[50]
- Broadband
- Broadband refers to cable modems.
- Flip Video
- With the acquisition of Pure Digital Technologies, Cisco began to sell a
line of video recording devices called "Flip Video" that had been Pure
Digital's only line of products. This line of products was not as popular as
Cisco had thought it would have been, and on April 12, 2011, Cisco announced
they were discontinuing all
Flip camera production.[51][52]
Cisco ūmi product line—video conferencing for home also proved to be a
short-lived bid for consumer multimedia market and did survive in Cisco
product lineup.[53]
Hardware
A Cisco ASM/2-32EM router deployed at
CERN in
1987
Data
- Datacenter products:
Nexus Switches (1000v, 2000, 3000, 4000, 5000,
7000), MDS, Unified Computing System (UCS)
-
Routers, including: 837, 1000 Series,
2500 Series,
7600,
12000,
3600 Series, ASR Series and
CRS-1 and CRS-3
- Security appliances: ASA 5500,
PIX 500
series, Cisco Security Manager, Email Security Appliance (ESA),
Web Security Appliance (WSA),
Content Security Management Appliance (SMA)
-
Catalyst switches:
1900 Series, 2900 / 2950 / 2960 / 3500XL Series, 3550 / 3750 Series,
3000 Series,
Catalyst 4500/4900, 5000/5500 Series,
6500 Series
- Teleworker/Remote Connectivity—Cisco
LAN2LAN Personal Office for ISDN, VPN 3000 Concentrators
- Cisco Wireless LAN products—Access Points, PCI/PCMCIA/USB Wireless LAN
Adaptors, Wireless LAN Controllers (WLC), Wireless LAN Solutions Engines (WLSE),
Wireless Control System (WCS), Location Appliances, Long range antennas.
Telephony Products
- Collaboration Systems—Cisco
TelePresence, (Cisco Manufacturing Mobile Video Collaboration with
Librestream, Cisco acquired
Tandberg,
the world leader in Telepresence systems)[54]
- IP Telephony (VoIP) Servers and Appliances
- Cisco Unified IP Phones—Wireless
IP Phone 7920, 7945, 7965, 7942, 8900 series, 9900 series, 6900 series
Servers / Application Appliances
Experimental
-
CLEO (Cisco Low Earth Orbit router)
-
IRIS (Cisco Internet Routing in Space)
Other Products
- Cisco Cius: a new Android-based collaboration tablet (now discontinued)
- Set Top Boxes (High Definition PVRs)—Cable/IP
-
Flip pocket camera (Discontinued in April 2011)[56]
Software
Operating Systems
VPN/Remote Connectivity
Telephony/VoIP
- Cisco Call Manager / Call Manager Express
-
Cisco Unified Communications Manager
- Cisco Unified Operations Manager (CUOM)—is a NMS for voice. It features
real-time monitoring of all system elements, and performs automatic
discovery for the entire system and provides contextual
diagnostics for
troubleshooting.
- Cisco IP Communicator is a VoIP softphone software application. It can
register with a Cisco Unified Communications Manager or Cisco Unified
Communications Manager Express using either SIP or Cisco's proprietary
Skinny Client Control Protocol.
- WebEx
Collaboration Tools
Other
- Cisco Active Network Abstraction
- Cisco Fabric Manager
- Data Center Management and Automation—Cisco Intelligent Automation
- Cisco Tidal Enterprise Scheduler
- CiscoView
- CiscoWorks
Network Management software
- Cisco
Eos
-
Packet Tracer, didactic network simulator
- Cisco Network Magic Pro
- Cisco Quad
- Cisco Security Manager
- Cisco SDM
- PostOffice protocol (not to be confused with POP3, SMTP, or other mail
delivery protocols). It is a Cisco proprietary protocol that runs on port
UDP/4500. It provides a communications vehicle between the sensors and the
Director platform.
VoIP services
Cisco became a major provider of
Voice
over IP to enterprises, and is now moving into the home user market through
its acquisitions of Scientific Atlanta and Linksys. Scientific Atlanta provides
VoIP equipment to cable service providers such as
Time
Warner,
Cablevision,
Rogers Communications, UPC, and others; Linksys has partnered with companies
such as
Skype,
Microsoft
and
Yahoo!
to integrate consumer VoIP services with wireless and cordless phones.
Hosted
Collaboration Solution
Cisco partners can now offer cloud-based services based on Cisco's
virtualized Unified Computing System (UCS). A part of the Cisco Unified Services
Delivery Solution that will include hosted versions of Cisco Unified
Communications Manager (UCM), Cisco Unified Contact Center, Cisco Unified
Mobility, Cisco Unified Presence, Cisco Unity Connection (unified messaging),
and Cisco Webex Meeting Center.
[57]
Network Emergency
Response
The company maintains several Network Emergency Response Vehicles (NERV)s.
The vehicles are maintained and deployed by Cisco employees during natural
disasters and other public crises. The vehicles are self-contained and provide
wired and wireless services including voice, and radio interoperability, voice
over IP, network based video surveillance and secured high definition video
conferencing for leaders and first responders in crisis areas with up to 3
Mbit/s of bandwidth (up and down) via a 1.8-meter satellite antenna.
[58]
NERVs are based at Cisco headquarters sites in San Jose, California and
Research Triangle Park, North Carolina allowing strategic deployment in North
America and are capable of being fully operational within 15 minutes of arrival.
[57][58] High capacity deisel fuel tanks allow the largest vehicles to run for
up to 72 hours continuously.
[59]
The NERV has been deployed to incidents such as the
October 2007 California wildfires; hurricanes
Gustav,
Ike,
and
Katrina; the
2010 San Bruno gas pipeline explosion, tornado outbreaks in
North Carolina and
Alabama in 2011; and Hurricane
Sandy in 2012.
[60][61]
The team maintains and deploys smaller more portable communication kits which
are deployed to emergencies outside of North America. In 2010 the team deployed
to assist in earthquake recover in Haiti and Christcurch, New Zealand. In 2011
they deployed to flooding in Brazil, Tsunami in Japan.
[62]
In 2011, Cisco received the Innovation Preparedness award from the
American Red Cross, Silicon Valley Chapter for its development and use of
these vehicles in disasters.
[63]
Cisco Career
Certifications
Cisco Systems also sponsors a line of
IT Professional certifications for Cisco products.
[64]
There are five levels of certification: Entry (CCENT), Associate (
CCNA
/ CCDA), Professional (CCNP / CCDP), Expert (CCIE / CCDE), and recently
Architect, as well as eight different paths, Routing & Switching, Design,
Network Security, Service Provider, Service Provider Operations, Storage
Networking, Voice, Datacenter and Wireless.
A number of specialist technician, sales and datacenter certifications are
also available.
Cisco also provides training for these certifications via a portal called the
Cisco Networking Academy. Qualifying schools can become members of the Cisco
Networking Academy and then provide CCNA level or other level courses. Cisco
Academy Instructors must be CCNA certified to be a CCAI certified instructor.
As a global provider of network solutions, Cisco often finds itself at the
frontier of technical education. With over 10,000 partnerships in over 65
countries
[65]
Cisco Academy program operates in many exotic locations. For example, in March
2013, Cisco announced its interest in
Myanmar by investing in two Cisco Networking Academies in
Yangon and
Mandalay
and a channel partner network.
[66]
Criticisms and
controversy
Shareholder relations
A class action lawsuit filed on April 20, 2001 accused Cisco of making
misleading statements that "were relied on by purchasers of Cisco stock" and of
insider trading.
[67]
While Cisco denied all allegations in the suit, on August 18, 2006, Cisco's
liability insurers, its directors, and officers paid the plaintiffs
US$91.75 million to settle the suit.
[68]
Intellectual
property disputes
On December 11, 2008, the
Free Software Foundation
filed suit against Cisco regarding Cisco's failure to comply with the
GPL
and
LGPL license models and make the applicable source code publicly available.
[69]
On May 20, 2009, Cisco settled this lawsuit by complying with FSF licensing
terms and making a monetary contribution to the FSF.
[70]
Censorship in China
Cisco has been criticized for its involvement in
censorship in the People's Republic of China.
[71]
According to author Ethan Gutmann, Cisco and other telecommunications equipment
providers supplied the
Chinese government with surveillance and Internet infrastructure equipment
that is used to block Internet websites and track Chinese online activities.
Cisco says that it does not customize or develop specialized or unique filtering
capabilities to enable governments to block access to information and that it
sells the same equipment in China as it sells worldwide.
[72]
Wired News had uncovered a leaked, confidential Cisco power point
presentation that details the commercial opportunities of the
Golden Shield Project of Internet control.
[73]
In her article, journalist Sarah Stirland accuses Cisco of marketing its
technology "specifically as a tool of repression."
Tax fraud
investigation
On October 16, 2007, the
Brazilian Federal Police and Brazilian Receita Federal (equivalent to the
American IRS), under the "Persona Operation", uncovered an alleged tax fraud
scheme employed by Cisco Systems Brazil Chief Carlos Roberto Carnevali since
2002 that exempted the company from paying over
R$1.5 billion
(US$824 million) in taxes.
[74][75]
Antitrust lawsuit
On December 1, 2008,
Multiven
filed an
antitrust lawsuit
[76][77][78][79][80][81]
against Cisco Systems, Inc. in an effort to open up the network maintenance
services marketplace for Cisco equipment, promote competition and ensure
consumer choice and value. Multiven's complaint alleges that Cisco harmed
Multiven and consumers by bundling and
tying
bug
fixes/
patches
and updates for its
operating system software to its maintenance services (SMARTnet) and through
a series of other illegal exclusionary and
anticompetitive acts designed to maintain Cisco's alleged monopoly in the
network maintenance services market for Cisco networking equipment. Cisco
responded by accusing the person who filed the anti-trust suit, British-born
Peter Alfred-Adekeye, with hacking and pressured the US government to extradite
him from Canada, where he was giving evidence against Cisco in an anti-trust
hearing. Canadian Judge Ronald McKinnon, who oversaw the extradition hearing,
stated the real reason for the extradition proceedings was because Alfred-Adekeye
"dared to take on a multinational giant." He also condemned the US prosecutor
for hiding the fact that Alfred-Adekeye was in legal proceedings against Cisco
Systems, for stating that Alfred-Adekeye had left the USA in a time period when
he had not and a formal request for extradition was not filed against Alfred-Adekeye
when he was taken into custody. Judge McKinnon described the information
provided by Cisco and the US prosecutor as "full of innuendo, half-truths and
falsehoods," adding that "This speaks volumes for Cisco's duplicity" and accused
them of "unmitigated gall" in using such a heavy-handed move as an unsupportable
arrest and jailing to pressure Alfred-Adekeye to drop or settle his civil
antitrust complaint.
[82]
Intimidation
Cisco has been reported as using intimidation tactics in several news
reports.
[83][84]
Remotely monitoring users' connections
Cisco's Linksys E2700, E3500, E4500 devices have been reported to be remotely
updated to a firmware version that allows Cisco to monitor their network use.
[85]