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When Cisco announced strong earnings during its most recent fiscal quarter, much of the progress was attributed to the networking giant's strides in software-defined networking (SDN).
SDN technology broadly eliminates manual management of switches and other networking hardware by abstracting control to a single administrative console. Such networks factor into many of the IT world's most impactful movements, such as virtualization and cloud computing, but according to Cisco CTO Padmasree Warrior, SDN is a constraining concept that falls short of the company's more ambitious vision: an intelligent, programmable network that will not only link billions of devices to the Internet but also, thanks to the data mining the network enables, inject trillions of dollars into the global economy.
Put another way, Cisco's broader vision involves building out the Internet of Everything (IoE). Warrior delivered her remark on Wednesday during an interview with InformationWeek at the company's annual Editors Conference, where she and other Cisco leaders described IoE's disruptive potential, which includes increasing global profits by 21%, or $14.4 trillion, over the next decade.
This bold forecast is rooted in converging technologies, starting with the explosion of everyday objects, from utility meters to iPads, that are now equipped not only to access the Internet but also, thanks to the availability of low-cost sensors, to collect data on an unprecedented scale. These connected devices populate the so-called Internet of Things and Cisco anticipates these objects will see 400% growth over the next few years, totaling 50 billion by 2020. The company has defined IoE as "the network and processes that both unite the objects and supply the analytical muscle to make the collected data useful."
[ Internet of Everything: the future or just more high-tech hype? Read Cisco's Internet Of Everything Plan: 4 Facts. ]
Warrior has been testifying in blog posts that Cisco is serious about its IoE goals. CEO John Chambers revealed just how serious in late February, when he characterized the endeavor as the cornerstone of Cisco's future.
During the interview, Warrior stated that "the future will be about a programmable network that is much broader than SDN." She elaborated that captured data can't be sent en mass to the data center, and that network intelligence, be it at the edge of the network or at the endpoint itself, must negotiate when to crunch numbers locally and when to transmit content elsewhere. This model of distributed networking will, in Cisco's view, involve open APIs along with a new wave of apps that can recognize how the network is architected.
These changes don't necessarily mean that existing infrastructure will need to be replaced. Cisco futurist Dave Evans has suggested that many of IoE's biggest potential benefits, such as near-universal access to healthcare and education, will arise not from futuristic new devices but rather from the simple addition of radios and sensors to many of the objects we already use; a smart bathroom mirror, for example, could be central to extending human lifetimes by decades and perhaps even centuries. Similarly, Warrior said that Cisco's installed user base, which has invested $180 billion in the company's gear, will be able to join the Internet of Everything by exposing existing hardware to open APIs.
"For applications to be aware of the network, you need to create programmability at different levels," she said. "But people are not going to throw away their existing install base and go to something completely new. That would mean huge amounts of capital, and we all know IT budgets are constrained."
Indeed, Cisco's IoE talking points reaffirm business' ability to generate new revenue streams from existing infrastructure. The company's location-based analytics tools, for example, could allow retailers to increase sales via personalized advertising while also monetizing their Wi-Fi networks.
Customers will be able to utilize these APIs with Cisco's One Platform Kit, which includes hundreds of APIs. The company's ASICs, the integrated circuits inside routers and switches, will also deliver programmability.
When John Chambers discussed IoE in February, he said that success will rely on open standards and cross-industry collaboration; otherwise, an object speaking one proprietary language won't be able to communicate with objects built on other proprietary platforms, limiting the extent to which different data points can be pulled together. To effectively deploy IoE on a citywide scale, for example, local leaders would need to aggregate data collected by devices from different manufacturers. If utility meters, traffic monitoring devices, atmospheric sensors and other objects all collect information autonomously and in a vacuum, their respective data points will speak only to finite use cases.
Cisco's devotion to standards is notable, given that less than a year has passed since InformationWeek survey respondents criticized the company for being too proprietary. Warrior said the results were somewhat surprising, as Cisco has advocated an open approach for years. She suggested the outgoing network model itself might be partly to blame, however; pointing out that while the command-line interfaces that typify traditional networks amount to a closed system, the new networks' API-driven compatibility translate this system into an open platform.
Warrior said that businesses must consider specific challenges when devising an IoE strategy, a recommendation that echoes John Chambers's view that companies should focus on use cases rather than technology. She said that Cisco is developing use cases for specific verticals to improve efficiency, such as a manufacturing plant that installs sensors in the factory to more accurately detect developing equipment malfunctions.
Evoking the CEO's argument for cross-industry cooperation, Warrior said that certain vertical uses cases could easily become horizontal in execution. A merchant, for example, might collaborate with the city to help customers reserve parking spots via a smartphone app, which would benefit the retailer by driving traffic to the store, the city by reducing traffic congestion and pollution, and consumers by mitigating gas costs and time lost to parking searches.
Cisco's IoE plans are already moving quickly and could pick up additional steam in October, when the company will host its Internet of Things World Forum in Barcelona, Spain. Based on the agenda discussed at a steering committee in February, when Chambers declared IoE's place in his company's plan, the conference will address revenue opportunities, standards and collaboration, as well as security, privacy concerns, social impacts and IoE availability in the developing world.
Chambers suggested that IoE's winners and losers could be determined within the next five years, if not sooner. Time will judge this statement, of course, but given that the World Forum's participant roster includes heavyweights such as General Electric, Ford, Oracle, Qualcomm and Verizon, Cisco certainly seems to have the industry's ear.
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