It’s been a big year for Cisco in more ways than one. Across its global operations, the networking powerhouse was, like many of its peers, hit pretty hard by the economic downturn.
Globally, its net income fell nearly 24 per cent from the previous year on sales that were down almost 9 per cent. For the 2009 fiscal year ended July 25, Cisco earned $US6.1 billion, or $US1.05 per share, on net sales of $US36.1 billion.
On the human side of things, the vendor also announced it would be cutting hundreds of staff as part of efforts to trim costs to combat the economic downturn; this included its Australian workforce.
And the dramatic fall of the Aussie dollar – which dropped by up to 25 per cent in the space of six months – forced Cisco to up its prices on all products by 18 per cent at the end of 2008.
But the negative sentiment creeping out of the global economic crisis is only a fraction of the story. At the same time, there has been a steady stream of new and positive developments, particularly from a channel perspective.
Kicking off the good news element was the launching of a new small business group and range of products as part of efforts to grow its presence in the sub-100 customer segment.
Cisco invested $US100 million into building up small business marketing, services, product and staff capabilities and established a new Small Business Technology Group (SBTG) with dedicated headcount.
Then the vendor put together a new go-to-market program to facilitate partner-to-partner collaboration worldwide, called Global Resale Agent. The model allows partners to locate an agent partner from another geography to provide customer installation services on their behalf.
And the developments kept coming: Cisco announced Michael Lehmann would take on the role of partner operations director vacated mid-year by Jeff Sheard; it launched the Cisco Consumer Channel Network (CCN) to provide resellers with benefits and incentives around the Linksys by Cisco range; it unveiled plans to buy Pure Digital Technologies, the maker of the popular Flip Video handheld camera, for $US590 million in stock; CEO, John Chambers, took the wrappers off a new "unified computing" initiative which included a blade server code-named California; it upped the ante with a new top certification in the Cisco Certified Architect; it revamped its managed services program and launched new financing and rebate offerings; and launched a datacentre partner program and individual certifications.
