Video over IP will drive carrier and business network loads to new highs, forcing users to look to Cisco for products and services to manage this network stress, CEO John Chambers said to a group of industry and financial analysts.
Speaking at Cisco's World Wide Analyst Conference this week, Chambers told the audience that video will be a key factor in allowing Cisco a 10% to 15% growth annually over the next several years.
"Video is an art, not a science," chambers said. "Making it work is really, really difficult."
Chambers said carrier network loads in countries outside the U.S. are growing at 100% a year. He predicts that it's possible to have a growth of 300% to 500% a year, as countries in Asia and North America look to deliver high-definition IP television with advanced on-demand services.
This leads to a simple equation, which Chambers says, will work out well for the vendor and its shareholders.
"Loads on networks are what drives [the number of] devices we can sell," he added.
These factors justify the vendor's most significant internal product developments, and external acquisitions over the last few years.
"With video, we were good about connectivity and transport, but not good about interactions. That's why we acquired Scientific-Atlanta." The end-user interactions with SA's products fill this void, he added.
Chambers says they built the [Carrier Routing System], Cisco's multi-terabit Internet router, to account for the bandwidth growth he predicts video will bring.
In the enterprise, video and service-oriented applications will have a similar effect on business networks, creating more bandwidth, and complexity for network professionals to manage. The main driver is productivity; as an example, Chambers said, a year's worth of e-mails can be communicated in a one- to two-hour video session, in some cases. Of course, this will all have to be done on a tight budget, he added.
"CIOs did such a good job consolidating data centers and cutting costs during [the economic] downturn," he said. "Now CEOs expect their CIOs to deliver capabilities with flat or nominal growth in IT budgets."
Cisco's sales/technology pitch to make this happen: "run network applications as services and that are integrated tightly with network infrastructure."
"How you [can] share existing applications and bring up new applications faster" is the challenge, Chambers said.