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Shiva: the comeback kid?

Shiva: the comeback kid?

CEO James Zucco (right) wants Shiva to be your customers' virtual private network (VPN) company. It's been a bumpy year for Shiva since it decided to break out of the remote access pack and dabble in the carrier market. But Shiva is returning to its roots. By focusing on products that provide dial-up remote access over the Internet, Shiva hopes to meet the needs of corporations looking for inexpensive ways to tie remote workers and business partners into corporate networks. In addition, the company renegotiated the deal with Nortel that gave Shiva access to carrier customers. Shiva CEO James Zucco, who was appointed last October, recently spoke about the company's VPN strategy and the competitive remote access marketplace with IDG's John Gallant and Tim GreeneIDG: How do you convince customers to go VNP?

Zucco: How do you make a graceful migration of your appropriate traffic from direct-dial remote access to VPN? How do you get the benefits of both? How do you create a single management environment that allows you to do direct dial and VPN?

Fifty per cent of remote access traffic is local. VPNs don't add complexity to the local remote access call. With the growth of telecommuting, demands are high. We also have known for some time that the public phone network provides enormous redundancy that data networks don't, as Internet outages show.

As a fallback, direct-dial remote access will still be an important part of a CIO's portfolio of technology for some time.

There is wariness among customers about the whole VPN concept, let alone the actual VPN services. How do you deal with that?

The current solution for remote access is running complex data communications stuff over the phone system. One of the biggest factors in remote access is the long-distance cost.

In dealing with some of the early VPN adopters, they are saying: "OK, we're going to peel off some of our traffic and put it on a remote access VPN."

The cost savings let users get a two- or three- month payback on the technology. Is it a risky strategy for us?

It's always risky going into new markets, but you want early market share. And I think there is a compelling set of economics to encourage customers and customers' bosses to say: "Let's try this."

You have a box, but it's also a crowded field. What is your window for optimising the opportunity?

For the longer term, we fundamentally believe remote access isn't going away. The modem business will continue to be strong. The consolidation of the ISPs over the course of the next couple of years will provide an access field around the world for VPNs.

Once that access field is in place, you'll need VPN technology on the premises, and we will be there with early market share. It's an important evolution, and we hope to lead it. Part of it is demystifying, part of it is delivering.

What was wrong with the original Nortel deal?

It was complicated. The simplest way to say it is the expenses saved were not nearly covering what we were spending on research and development.

We were spending more than half of our R&D dollars on the carrier, but 85 per cent of our business was spent on remote access.

We had a choice to make, of whether we serve our customers or serve what were in fact Nortel customers.


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