500-560 study - Cisco Networking: On-Premise and Cloud Solutions Updated: 2024

In addition, the study claimed that use of mobile data services led to a 1.9 percent increase in the Gross Domestic Product of the U.S. in 2003. That productivity increase was the equivalent of $10.4 trillion, according to Cisco.

The study was conducted for Cisco by OMNI Consulting Group and measured total factor productivity (TFP), which is a method of determining how well businesses use capital, labor technology to produce goods and services.

The study found particularly strong productivity gains in specific industries. For instance, it found that insurance claims adjusters could handle 7.4 more claims per week by using mobile devices and wireless networks. Similarly, sales representatives in the healthcare and pharmaceutical field were able to conduct 8.3 more physician briefings each week because of mobile data and voice access.

The study also found that hotel guests were far more likely to select a hotel with broadband connectivity and would spend almost seven per cent more for hotel rooms with connectivity.

"This study shows that with mobile data services, workers are not only more productive, but they also develop new business processes that yield increased customer and job satisfaction as well as competitive advantage," Steve Hoch, Cisco's director of service provider mobility, said in a statement. "This research shows businesses that the rewards of investing in mobile data services are real and compelling."

"The scope of this research breaks new ground in quantifying the net impact of mobility and its associated productivity gains by examining business and worker performance under many different scenarios," Frank J. Bernhard, technology economist and managing principal with OMNI Consulting Group, said in a statement.

Ethernet switch

That's according to Canalys, which on Wednesday reported overall Q1 revenue for the Ethernet switch market as down 8.8 percent compared to the year-ago quarter.

Canalys attributed the revenue decline to aggressive port-pricing competition and the weakened public sector demand in both North America and Europe. Despite a 2.5 percent annual increase in ports, Canalys said, total end-user revenue also decreased 12.3 percent from the fourth quarter of 2010.

Matthew Ball, Canalys director of enterprise services, warned that increasing pressure on the switch market could have a ripple effect for the channel.

"If current trends continue, vendors and channel partners will have to sell more volume than expected to reach revenue targets," Ball wrote in a research note. "This competition could trigger a wave of merger and acquisition activity among smaller switch vendors as they try to gain economies of scale."

Among vendors, Canalys highlighted the ferocious competition between Cisco, HP Networking and Juniper. According to the researcher, Cisco's overall Ethernet switch share dropped to 68.2 percent from the fourth quarter's 69.2 percentage, and from 73.1 percent a year ago. Cisco, which is in the midst of a broad restructuring as it attempts to counteract several disappointing quarters' worth of earnings, still derives nearly half its revenue from switching and routing. Switching revenues declined 9 percent in Cisco's third quarter, according to its most recent earnings report.

HP Networking, on the other hand, is gaining in the market, according to Canalys, which gave HP a 14.1 percent share of Ethernet switching. HP, which increased its stake in part from the 2010 acquisition of 3Com, has been aggressively touting itself as a lower-cost alternative to Cisco, especially in data networking.

Juniper, meanwhile, continues to gain on its EX switches, and according to Canalys, also gained share from the year-ago quarter, currently pegged at 2.4 percent, with growth more than 22 percent from a year ago.

The fourth- and fifth-place enterprise switch vendors (Layer 2/3/4 only, as Canalys evaluates them) are Brocade and D-Link, the latter of which gained 18 percent and claims a 1.6 percent share. Other vendors account for 11.5 percent of the market collectively.

Cisco will continue to be challenged on all sides, Canalys noted.

"Cisco is facing intense pressure on both its core switch and overall enterprise networking business," Ball said. "It is up against aggressive competition from Juniper in routing, Riverbed [Technology] in WAN optimization, F5 Networks in application delivery controllers and Brocade in storage networking.

By region, North America saw the steepest declines in Ethernet switching, down 13.3 percent and largely attributable to declines in federal government spending. Europe, the Middle East and Africa (EMEA) decreased 6.7 percent year over year, and Asia Pacific (a 3.7 percent decline) and Latin America (a 1.4 percent decline) were also down. Canalys noted that the true effects of the March earthquake in Japan won't be known until Q2 numbers are finalized.

The "lone bright spot" in Q1 was the growth in 10Gb port shipments, according to Canalys. Those increased 69.9 percent year over year. 1Gb ports, by contrast, grew 12.4 percent, and 100Mb ports decline 5.7 percent. Data center networking will be an increasingly contentious battleground, Ball said, given the range of vendors that announced data center fabric strategies within the past year.

Research from internet of things (IoT) analyst firm Berg Insight found that 2,900 private LTE/5G networks were in place across the world at the end of 2023, including trial and pilot deployments.

The research report, Private LTE/5G networks for IoT applications, defined a private cellular network as a 3GPP-based private LTE/5G network built for the sole use of a private entity such as an enterprise or government organisation. Referred to as non-public networks by the 3GPP, private LTE/5G networks use spectrum defined by the 3GPP and LTE or 5G NR base stations, small cells and other radio access network (RAN) infrastructure to transmit voice and data to edge devices.

According to Berg Insight, these developments are opening up a range of opportunities for the cellular ecosystem, fuelling a new wave of investments by established network equipment suppliers and attracting new entrants into the space. It noted that private LTE/5G network deployments were growing from a small base, with an increasing number of organisations trialling and deploying networks.

Berg Insight estimates there are about 2,200 private 4G LTE networks currently deployed globally, serving a variety of use cases. Private 5G network deployments are moving from trials to commercial operations, which Berg said amounted to an estimated 700 networks.

The analyst forecast that to 2028, the number of private LTE/5G network deployments would grow at a compound annual growth rate (CAGR) of 33% to reach 11,900 networks at the end of the period. Increasingly, the networks will be deployed into commercial operations faster as there is less need for use case testing.

Berg also predicted that a “meaningful” number of private LTE network deployments would also be upgraded to 5G, starting in the next two to three years.

The report identified a market comprising important specialised core network software suppliers, including Druid Software, Athonet (acquired by HPE in June 2023), Affirmed Networks and Metaswitch (both part of Microsoft since mid-2020).

Berg said EPC/5GC offerings were available from close to 30 suppliers. A third category comprises IT-centric players like Cisco and HPE. These companies focus on delivering fully integrated Wi-Fi and private LTE/5G solutions, enabling network managers to administer Wi-Fi and private LTE/5G networks through a single interface. Celona is a new entrant in the space, backed by NTT Data and Qualcomm, offering its integrated private cellular software in a single subscription.

“The major RAN vendors (Ericsson, Nokia and Huawei) all play significant roles as integrated solution providers and are challenged by a number of smaller RAN equipment providers. Nokia counts the largest number of private network deployments, with more than 635 private cellular network customers at the end of Q2-2023,” said Fredrik Stalbrand, principal analyst at Berg Insight.

“The vendors increasingly pursue channel-led sales strategies, and have developed ecosystems of mobile operators, systems integrators, VARs and consulting partners to bring solutions to market,” he added.

The report also highlighted a number of small cell and other RAN equipment providers, including Airspan Networks, Baicells, CommScope, JMA Wireless, Mavenir, Samsung Networks, Sercomm and ZTE provide LTE/5G radio products and in some cases complete private network offerings.

State Fair Community College’s faculty Andy Hoos and Deaven Kaiser recently earned certifications in their areas of study. 

Hoos, Computer Networking/Administration program coordinator, has recently earned the Certified Information Systems Auditor certification (CISA), Certified Information Security Manager (CISM) certification, and the AZ-500 Microsoft Security Technologies certification (AZ-500). The CISA is the world-renowned standard of achievement for those who audit, control, monitor, and assess information technology and business systems.

The CISM certification is the globally accepted achievement for individuals who develop, build and manage enterprise information security programs. The AZ-500 evaluates skills in security components and configurations to protect identity, access, data, applications, and networks. He also holds a Certified Information Systems Security Professional (CISSP), CompTIA A+ and Security+, and the Cisco Certified Network Associate (CCNA) certifications.

Hoos has taught at SFCC for 12 years and received a Bachelor of Arts in Computer Information Systems from Campbell University, Bachelor of Science in Cyber Security from Central Methodist University, and a Master of Arts in Computer Information Systems and Resource Management from Webster University.

Visit www.sfccmo.edu/networking to learn more about SFCC’s Networking program.

Kaiser, a Computer Information Systems program instructor in his first year at SFCC, recently completed an Associate Certification course earning Apple's App Development with Swift Associate Certification via Certiport. Swift is a powerful and intuitive programming language for first-time coders and full-time developers. Certification recognizes foundational knowledge of Swift, Xcode and app development tools.

“The knowledge and skills that I have learned during the process of this certification program will allow me to grow my program,” said Kaiser. “With the addition of Swift, students taking the Computer Information Systems Programming degree track will not only learn the fundamentals of software development but also mobile. With the knowledge and skills that students will acquire in the future Apple development class, they will be able to create programs and apps that could even be published on the Apple App Store.”

Kaiser has earned Associate of Applied Science and Associate of Fine Arts degrees from SFCC, a Bachelor of Arts degree from University of Arizona, and a Master of Education from University of Missouri. He worked seven years as a network technician at LammTech Resources and three years as the technology director for Smithton R-VI School District.

To learn more CIS programming, visit www.sfccmo.edu/cis-programming

In the photo: Andy Hoos, State Fair Community College’s Computer Networking/Administration program coordinator, has recently earned certification in CIS, CISM and AZ-500 Microsoft Security Technologies.  Deaven Kaiser, State Fair Community College’s Computer Information Systems program instructor, has recently earned Apple's App Development with Swift Associate Certification via Certiport. 

The rapid awareness and adoption of artificial intelligence has increased concerns around security, governance, compliance and business risk.

The digital business imperative to improve customer experience combined with a vastly more complex technology environment, comprising multiple clouds, the internet of things, containers, app integration and the popularity of open source, are driving need for better observability across technology stacks. But fragmented information technology environments, lack of talent and a spate of existing installed monitoring tools are preventing organizations from achieving their full-stack observability aspirations.

In this Breaking Analysis, we dig deeper into the trends in observability based on a recent custom study from our partners at Enterprise Technology Research. As always, we’ll provide our perspective on the market and players with a view toward trends to watch in 2024.

What is full-stack observability & O11Y?

Full-stack observability is the capability to discover the real-time status of each technology stack component in a distributed IT environment. It involves holistically viewing cloud-hosted applications, services, infrastructure, on-premises IT, K8s (there’s your O11Y hint) infrastructure and more. O11Y uses telemetry data such as metrics, logs, traces and other information from the entire IT environment to provide complete end-to-end visibility to understand the connection and dependencies among IT components.

FSO is more than just monitoring and reporting. It uses reasoning and often machine intelligence to draw conclusions about an environment to recommend change or even take action on behalf of humans.

New survey captures the customer mindset of FSO

FSO or O11Y has been a hot topic in the press and analyst community. That’s why we’re so excited to share the results of a recent study from ETR.

ETR has an amazing custom research capability that we’re privileged to share with you. This particular study was done in partnership with New Relic Inc., which we promise has zero influence on the commentary and conclusions of this Breaking Analysis or the ETR analysis.

This particular study had 1,700 respondents and, unlike most of the work we share, had a global respondent base, with U.S. customers only accounting for about a quarter of the survey. The companies spanned multiple industries, all organization sizes (80% more than 5,000 employees) and mostly technology practitioners.

Like security, observability is a crowded market

It has grown out of the world of application performance monitoring or APM, network monitoring, log analytics, AI operations or AIOps, database performance management, dashboarding, error tracking and literally dozens of legacy and fragmented market segments. There are literally dozens and dozens of vendors in this space.

Here’s a sample using network monitoring as the sector of choice. In this space “other” is the leading vendor, which underscores how crowded the market is. But the likes of Splunk, Grafana, Dynatrace, Elastic, AppDynamics, open-source tools such as OpenTelemetry, Prometheus and the ELK stack, New Relic, Sumo Logic and more play in this specific market.

On the right-hand side of this chart you can see the sectors ETR tracked in this study – about 18, including distributed tracing, serverless monitoring, mobile monitoring, MLOps and so forth. Selecting each one in the pulldown will shuffle the deck of players.

Splunk leads in most, but as the leader everyone wants to attack it and get a piece of its market. It’s why Cisco Systems Inc. paid $28 billion for Splunk, because it has the largest footprint. But there are many others. For example, in application performance monitoring, Datadog, Dynatrace, AppD (also owned by Cisco) and New Relic join Splunk at the top of the list. In synthetic monitoring, Dynatrace and Datadog pop up as most popular along with Splunk. In distributed tracing, Grafana, Dynatrace, Prometheus and OpenTelemetry are cited more often than Splunk. And “other” is always prominent.

You get the point. FSO involves a lot of different capabilities and there are many vendors playing in the market. For example, here are some names in the other category you may or may not know: Lucidworks, Exabeam, Sentry, Moogsoft, Honeycomb, ChaosSearch, Graylog, ScienceLogic, Cribl, Monte Carlo, Observe, InfluxData and dozens more I could name. It’s crowded.

Consolidation continues to be a theme, but it’s not easy

The market is so fragmented and the budget pressures of 2022 and 2023 have caused a consolidation of tools.

This chart shows the number of observability tools installed in 2023 (top) as compared with 2022 (bottom). And you can see the reduction in the percentage of customers with five, six, seven and eight tools – highlighted in red. And the shift to one, two and three tools installed is shown by the red arrows.

But it’s clear that the movement in the past year is just scratching the surface as around 60% of customers cite that they have four or more tools. So more work must be done to accommodate greater consolidation. Having said that, around 30% of customers in the survey lean toward having multiple tools as a means of tapping best-of-breed capabilities.

Like in security, the quest for excellence often results in fragmentation.

Which vendors benefit most from consolidation?

When asked which vendor platforms customers prefer to consolidate on, about13% say they don’t want to consolidate. But Splunk, Dynatrace and Datadog are most commonly cited.

Once again, “other” is in the mix pretty prominently, with Elastic, AppD and New Relic also showing.

Now some interesting things change when you filter the data. For example, executive management prefers to consolidate on Dynatrace and surprisingly a somewhat higher percentage, 16%, say they don’t want to consolidate.

For what it’s worth, the small percentage of females in the survey want to consolidate on AppDynamics, a company Cisco acquired in 2017. Services and consultancies prefer to consolidate on Datadog.

So again this just underscores the complexity and varied preferences of the market.

Humans are still in the loop

Another notable finding in the survey is the degree to which manual labor is still a dominant force.

Despite the AI hype, fewer than 10% of customers say their incident detection and remediation workflows in the future will be mostly AI-led. But a huge percentage – around 75% as shown on this chart – expect to have some type of AI-led automation in their identification and remediation workflows.

Automation is a two-edged sword. It’s one of those alluring concepts, but there’s real caution around trusting machines to judge what actions should and shouldn’t be taken and when. So given the sensitive nature of change management, we would expect this trend to continue to lean toward AI-led automation, but it will take some time before humans are mostly out of the loop. Moreover, while many vendors claim to have AI, there’s a wide spectrum of capabilities, and customers should be very cautious about vendor claims in this regard.

Now, not surprisingly, the regulated industries of financial services, healthcare and government see a much lower tendency to be mostly-AI led in this context over the next year (well under 5% say mostly AI-led in this chart), whereas industries such as energy and high tech are much more likely to adopt AI aggressively in this space.

Interestingly, the data show that senior managements are more likely to push for AI adoption whereas the practitioners, who literally have their jobs on the line – that is, machines replacing humans or getting fired for implementing rogue automation – are much less optimistic.

What does O11Y do for your business?

According to more than 1,500 practitioners in this survey, there are many benefits.

Better uptime, improved efficiency, more secure environment and a better customer experience help developers be more productive because they’re doing less troubleshooting and the like. And this ostensibly leads to greater business agility and more revenue. Only one-half of 1% cited no benefit. This is across all roles, all geographies and all industries, by the way.

But there are challenges to adopting FSO, including the siloed nature of data and IT, tools creep, lack of talent… but the No. 1 pressure is lack of budget – that is, it’s perceived as too expensive. So the industry has an opportunity to better sell the benefits.

Perhaps retiring goofy terms like O11Y would help!

FSO trends to watch

Security remains the No. 1 priority in the ETR survey data and that requires better visibility. So we don’t expect FSO to be a fad that fades in 2024. Just the opposite, actually. As digital businesses fight for customers and access to real time data becomes more critical, FSO will only grow in prominence in our opinion.

The latest ETR survey data on the spending macro is showing some positive momentum for 2024 – but really toward the second half. Amazon Web Services Inc. Chief Executive Adam Selipsky  said it best when he shared at the re:Invent in late November that we’ve seen better times, we’ve seen worse times, but we’ve never seen such uncertain times. True words of wisdom from the CEO of AWS.

Everyone is AI-crazed – including us – but your practitioners are cautious and probably skeptical that they have job security. So part of your challenge is to convince the doers that AI will bring new opportunities and relieve them of mundane and tedious tasks. And you’ll have to also put in processes to make sure that automation doesn’t create boo-boos because with the cloud and distributed computing, mistakes can travel fast.

The last point is that clearly the market generally and full-stack observability specifically are moving toward platforms. But the siloed nature of tech stacks, technical debt and sunk costs will mean a continued fragmented market. That said, those leaders with full-stack capabilities, cloud-native tooling and real AI will be in a good position to ride the consolidation wave in 2024 and beyond.

Keep in touch

Thanks to Alex Myerson and Ken Shifman on production, podcasts and media workflows for Breaking Analysis. Special thanks to Kristen Martin and Cheryl Knight, who help us keep our community informed and get the word out, and to Rob Hof, our EiC at SiliconANGLE.

Remember we publish each week on Wikibon and SiliconANGLE. These episodes are all available as podcasts wherever you listen.

Email david.vellante@siliconangle.com | DM @dvellante on Twitter | Comment on our LinkedIn posts.

Also, check out this ETR Tutorial we created, which explains the spending methodology in more detail. Note: ETR is a separate company from Wikibon and SiliconANGLE. If you would like to cite or republish any of the company’s data, or inquire about its services, please contact ETR at legal@etr.ai.

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All statements made regarding companies or securities are strictly beliefs, points of view and opinions held by SiliconANGLE Media, Enterprise Technology Research, other guests on theCUBE and guest writers. Such statements are not recommendations by these individuals to buy, sell or hold any security. The content presented does not constitute investment advice and should not be used as the basis for any investment decision. You and only you are responsible for your investment decisions.

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