Hewlett-Packard Company White Box Threatens Cisco Systems, Inc.

 

Hewlett-Packard Company (NYSE: HPQ) has been after Cisco Systems, Inc. (NASDAQ: CSCO) number one in the market for Ethernet switches of the company for a while, trying to capitalize on the growing popularity of the switch box white to your advantage. Last year, the company partnered with the Chinese partner of Apple, Foxconn, in an effort to provide basic servers for data centers to web scale. Latest push in the direction the company is a partnership with Accton Technology and Clusters Networks to launch HP switches white box commodity hardware will run in data centers to web scale.

The trend toward white box hardware has been spearheaded by relatively unknown Asian companies, and this has impacted brand leaders in the Ethernet market as Cisco and HP. These white box switches provide a cost effective alternative to brands like Cisco switches and are an attractive proposition for companies like Facebook Inc (NASDAQ: FB), Google Inc. (NASDAQ: GOOGL) and Amazon.com, Inc. (NASDAQ: AMZN).

These companies have been at the forefront of technology adoption white box and power network architectures that manage software. Facebook, in fact, was one of the biggest drivers of change, as its Open Compute Project producers helped design improves boxes blank white box at a cheaper price. HP addresses this market for client web database on a large scale, in a segment that values IDC analyst Rohit Mehra to $ 7-8 billion dollars in annual sales. White boxes undertake superior hardware, providing powerful and flexible software, HP customers also receive support services and consulting.

 HP is looking to partner networks, Accton to produce really changes. Meanwhile, the white frame will be provided with the operating system Cumulus' which is based on a variant of Linux and has already been adopted by companies like Verizon. However, the beauty of the concept of white box means that users are not connected with the supplied software, and can choose to run their software of choice in the white box. The flexibility in the choice of software has become an attractive factor in increasing consumer networking solutions.
 
Of course, this also means that customers do not depend on software from any vendor white box and can choose to change or diversify their suppliers. According to the Wall Street Journal, senior vice president and general manager of HP, Antonio Blacks, recognizes this reality and we said. We are accelerating the disintegration of hardware and software.

Cisco, the market leader in Ethernet switch is watching this accelerating trend. CEO John Chambers acknowledged that the hardware is the market segment of the white box that grows faster and is a threat to the existing products of the company and the business model. Cisco, which has provided the software and hardware bundle together a long time is starting to make changes to alleviate the threat. The company has, for starters, it has become much easier for customers and developers to write software that is compatible with your hardware.
 
However, Cisco has to act quickly and move into the white box market before HP obtains a significant advantage. More than that, the company must realize that the market preference has changed so that the hardware is cheaper and depends on more powerful software. Cisco only then find something that helps maintain first place in the market for Ethernet switches.