A company has just launched in Australia that claims it can sell Cisco wares; cables, memory and GBIC components, at a fraction of the cost Cisco charges the channel. The only thing is, it's not Cisco gear.
The componentry isn't branded as Cisco product but, as it's manufactured in the same factories as the networking giant, newcomer Cosmic says it's as good as.
Cosmic, an established operation in the UK, US and South Africa, purchases product from Cisco OEMs (original equipment manufacturers), ensuring that the products are Cisco compliant while selling them for massively reduced prices.
"We're breathing some life into an increasingly flat market," explains Cosmic's CEO, Anthony Johnson, in Australia for the opening of the firm's Sydney offices.
Cosmic is hoping to sign up dealers with direct relationships with Cisco, namely its three primary distributors: Tech Pacific, Express Data and LAN Systems, and Cisco's Gold reseller partners.
In its early stages, the supplier is offering four-day delivery on stock sourced from the US, with long-term plans to move to next-day delivery nation-wide.
However, the initial interest stirred up by Cosmic has been stymied somewhat by reseller concerns that using non Cisco-branded product will void warranties and incur the wrath of the world's largest networking vendor.
Cisco's response was measured.
"The general principle the customer must understand is where a customer [or a reseller] puts in a service call, and if the part that causes the problem isn't an authorised Cisco part, the warranty will be void," said Kip Cole, Cisco director of channel operations. "[However] Cisco is not going to do anything to a partner that acquires any product through legal and legitimate means."
"I wouldn't underestimate the value of the Cisco brand. Any reseller or customer has to bear in mind what kind of partnership [they] want with Cisco, and what value that brings to their business," he added.
Cosmic officials have dismissed the warranty concerns claiming that components such as memory or cabling rarely fail, but if they do it generally involves a simple direct swap.
"Our entire reputation is based around the approval assurance, that's why people deal with us," says Johnson. "It won't affect the [Cisco] SMARTnet warranty."
Michael Burt, business development manager for NetStar, says the temptation to save on cost as well as procure products more rapidly is one to be considered. He claims the integrator would consider purchasing the Cosmic range if it was to be endorsed by Cisco.
Director of LAN Systems Nick Verykios says despite the dangers of dabbling in what he calls "unauthenticated" products, Cosmic could find a huge market amongst Australian resellers.
However, Cisco did fire an ominous warning that it is going to be keeping an "increasingly vigilant" eye on any company in the industry misrepresenting unauthorised parts or product as Cisco stock.