The Architect: Q&A with John Chambers

Cisco has no intention of competing with vendors on price itself, he says. And beyond the routing and switching declines, the story of Cisco’s newer products – notably data centre virtualisation, up 59 percent year over year, and collaboration, up 37 percent – was definitely a bright one.

But along with softness in its consumer business and concerns for public sector, the numbers served to amplify a third straight quarter of disappointing results. Cisco’s gross margins also tightened to 60 percent, from 65 percent a year earlier.

“Cisco believes its 2011 fiscal year revenue will grow somewhere in the 9 percent to 10 percent range, which raises the question as to whether the company’s growth."

Q&A with John Chambers

Cisco's chairman and CEO sat down with CRN to cover the growth of its channel, why Cisco is a better bet for partners than HP or IBM and what role the network, collaboration, video and other Cisco hallmarks will play in the businesses of the future

CRN: If you were looking to tee up how to motivate solution provider partners and get them to visualise the industry heading into 2011 and beyond, what would you tell them?

 JOHN CHAMBERS: If you look at the breadth and depth ranging from such issues as collaboration, it’ll drive a decade of productivity. The first time I’ve ever heard [it] at the World Economic Forum, with top economists from Europe, the US and China, we talked about GDP growth for the next three to five years and beyond, and I asked about productivity and expected a candid answer of 1 [percent] to 1.5 percent, which is what they always say: ‘You can’t drive faster than that.’

All of them agreed that we were in for a decade of productivity growth that was probably two to 3 percent or more. When I asked them what’s going to cause that, they said, ‘What you’re doing, John.’ They said that in front of 100 of my customers, so I could have hugged them right there [laughter], but it would have been inappropriate.

What it does speak to is collaboration is the next generation of productivity, organisational structure, and is almost unlimited and an area I expect grows rapidly for us in the next five to 10 years.