Cisco: Services push won't fuel direct arm

Networking giant insists services business growth is ripe for channel opportunity

Cisco has insisted that its channel will not be locked out of future business as it pushes into the services market.

During a presentation at Morgan Stanley's Technology, Media and Telecom Conference at the end of last week, the firm's senior vice president for services Edzard Overbeek admitted that services was an important part of the company's strategy.

"We believe very firmly that [our strategy is] a combination of hardware, software, services and then the solutions that basically come out of that," he told investors, according to a Seeking Alpha transcript. "[Services are] absolutely important.

"The pull-through that I'm using is for instance where every dollar that we have on the consulting side, we have about $4 of professional and technical services and about $7 of product pull-through."

But Overbeek insisted the push would not tread on partners' toes.

"My partner business is the fastest-growing business in my services portfolio," he said. "So of course, we have some direct contracts but the partner business is actually increasing and part of the reason is... that we have a very different way of partnering."

Last week, Cisco unveiled partnerships with European telcos Telecom Italia and Deutsche Telecom (DT) in a bid to drive cloud and managed services across western Europe.

Overbeek added that agreements of this kind form part of its wider "intercloud" strategy.

"If you think about what intercloud provides right now, we have more than 400 datacentres in over 50 countries by just connecting clouds together," he said.

"And you start to see a whole interesting monetisation option because now partners such as Deutsche Telecom, for instance, can start to build relationships with Telstra in Australia because they can have wholesale agreements – think of roaming agreements like we've done in the mobile era – where they can have a physical location, a colocation, or a hosting location in a Telstra datacentre."