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Cisco keeps its chin up in downturn

Cisco keeps its chin up in downturn

Australia is third in the world behind Sweden and the US in terms of Internet connectivity, according to an IDC study quoted by Cisco senior vice-president, Howard Charney.

In an upbeat keynote address, delivered at the vendor's 11th annual Networkers conference in Brisbane this week, Charney said the Internet would continue to change the way people work, live, play and learn.

While admitting the hi-tech industry is currently depressed, Charney said the slowdown did not convey an accurate picture of what is going on with regard to the Internet.

He said it was obviously becoming a bigger part of daily lives and estimated that 581 million people access the Internet worldwide. He said the eight billion emails sent every day would become 26 billion by 2005 and one-third of the world's population would own a wireless device by 2008.

"The Internet is barely 20 years old and nothing has taken off so fast or touched so many people so quickly," he added.

Charney described the current Internet bust phase as one of convergence, simplification and standardisation and pointed to wireless technology merging with IP networks and the convergence of voice, video and data as examples of advancements that would aid the global mass commercialisation of the Internet.

However, he suggested that the broadband business model in Australia had to change before it took off.

"Telcos and service providers started life by selling voice telephone calls," he said. "That business has become less profitable, more dog eat dog and nobody can make money that way.

"Telcos have to come to grips with the fact that selling telephone calls is a bad business to be in and other services are the way to make money because history says if you bet against technology you lose every time."

Charney used trains, cars and semiconductors as examples of other great technological advances that have occurred since the industrial revolution in terms of the boom and bust that they all underwent before eventually establishing a sustained period of build out that saw them become an integrated part of everyday life.

"All [technological advances] have followed a cycle beginning with a boom where entrepreneurs and early adopters rally around, a relatively short bust and finally a build out that can last for decades once the technology becomes affordable, easy to use and part of our daily lives," he said.

Charney called the Internet a "disruptive technology" because it had the potential to be less expensive, more productive and offer more functionality than previous ways of doing business.

He claimed many business-to-business Internet exchanges failed during the dot.com crash because organisations tried to surplant existing supply chains instead of using the Internet as a supplementary way of doing business.

"e-Commerce is a channel, not an entirely new business," he said. "It can take a business into new markets, distribute knowledge to customers, suppliers and colleagues, and drive down costs."

He said further security improvements would be critical to mass deployment of new technological advances such as wireless or IP telephony and pointed to biometrics as an interesting development that could eventually remove the need to remember passwords.

"Security is no longer about placing a firewall somewhere," he said. "A solution needs to apply throughout the network, offering protection inside as well as out, and must be transparent, scalable, manageable and integral."

Charney said Cisco deployed wireless wherever possible because "if you don't eat your own dogfood you're worthless."

He claimed the organisation had overcome fears about security because it was "rock solid" and said the problem with getting enterprises to follow suit lay with a reluctance to spend money during the current difficult economic period. However, mass deployment of technology like wireless and IP telephony would happen.

"We know in our gut that all technological advances are cyclical and there will be an upturn," he said. "Every fibre in our bodies says we're not wrong, we just don't know when."


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