Blades Made Simple™

Hi Kevin,

Thanks for plugging my blog :-) And, yes, by way of disclosure I am a Cisco employee.

Just to clarify, the comment was that Cisco would be 50% of the #2 competitor in terms of market share by the end of CY2010. Frankly, John Chamber’s record in terms of what he has told the street over the past 20 years is impeccable. If he says the Cisco is going to be #3 in the ww blade server market by the end of CY 10 and 50% of the #2 competitor in the same timeframe, I don’t know of a financial and industry analyst who wouldn’t believe him.

One side note: If I were affiliated with certain competitors in any capacity I wouldn’t be too quick to cast dispersions on the credibility of Cisco’s CEO. Just sayin’.

@johnobeto writes up a good article on understanding IDC numbers (http://absolutelywindows.com/blog/2010/10/15/correctly-decrypting-the-idc-2q10-server-numbers.html) where he says the following about Cisco:

“In the absence of solid numbers from Cisco, the numbers floated around the Intertubes – both whisper and written – is that Cisco sold 1,000 servers in calendar year 2009.

We also know for a fact the Cisco is a very formidable competitor, imminently capable of double-digit growth even in new markets, which servers are for them.

Well, if we take that 1000-unit figure as the GAAP GARP (Generally Accepted Rumormongering Principle) number of Cisco servers sold in 2009, and unilaterally declare that Cisco is able to achieve a 99.99 percent growth quarter-over-quarter, we still come up with about 4000 servers for them. Applying a $20,000 average selling price to these 4,000 servers gives up Cisco server sales of $80 million. A mere pittance or insignificance, depending on your point of view. ”

Based on this math, how is that Cisco “UCS has already taken the #3 market share spot in US/Canada for x86 blade servers”??

If John had the facts…he would have shared them. This is simply to create buzz in the marketplace.

Like the other comment out there…over #### customers are running on UCS Servers. The reality is he’s counting hosting facilities where many users/companies share the same server. While the statement may be true if you count “hosted” clients….it’s a far stretch from large companies deploying the technology.

The biggest thing holding Cisco back is they bet their business on converged fabric, and quite frankly, its going to take a while to see FCOEE radified and widely adopted. While you’ll reduce your cable counts…you’ll increase your # of calls into support fixing bugs.

Kevin, I’ve provided some further explanation of this in my blog today (http://tinyurl.com/23pr622). Your questioning is completely fair, as we have not formally fed our revenue numbers into the IDC machine. That said, you can compare IDC’s published numbers with our material, public earnings statements and derive conclusions from there. Hope this helps.