Slashdot Mirror
Cisco to Acquire Linksys
forged writes "The Boston Globe is reporting that networking giant Cisco Systems plans to acquire Linksys later this year for $500M, thus entering the consumer market. Linksys also has a press release. The good news is that those who bought a Linksys access point now have a Cisco access point for 1/2 of the price ;)"
Finally Cisco is going to get some strength behind their networking products!
I mean, they (seem to me to) have a virtual monopoly on the business router market, and are now seem to be trying to extend it to the consumer market.
What do you guys think of Cisco, as a corporation? I remember seeing an article on Wired years ago about how happy the employees were about working there.
Things may have changed now, though.
tmegapscm
The good news is that those who bought a Linksys access point now have a Cisco access point for 1/2 of the price ;)
The bad news is that those who buy Cisco access points in the future will have a Linksys access point for twice the price ;)
Well bravo. Cisco's inraods into the consumer market didn't do too well, so it's a smart move to pick up an established brand. This also puts Cisco into direct competition with companies making both client and infrastructure devices (i.e. 3Com, Intel, etc).
The good news is that those who bought a Linksys access point now have a Cisco access point for 1/2 of the price
That is, until Cisco raises the price on all the devices sold under its Linksys brand by oh, about 50 percent so that it doesn't compete with Cisco brand devices.
Will I retire or break 10K?
And 1/4 the quality!
i see my linksys router spontaneously breaking post-acquisition and being replaced with cisco hardware...
...does this mean that Cisco's products will now start to suck total ass, or does it mean that Linksys's products will now stop sucking total ass?
The mind boggles.
- A.P.
"Remember when the U.S. had a drug problem, and then we declared a War On Drugs, and now you can't buy drugs anymore?"
Will require me to get CTHULHU? Cisco Training: Home User, Limited Home Use?
I think Cisco should have stuck to their core business and not try to diversify. This move will only be good for those few customers that will gain a Cisco access point for 1/2 of the price right now.
In the end it will probably just help create a new MS-like giant. I've never been a fan av any kind of corporate giant.
I have no doubt that Cisco is feeling the effects on their bottom line by Linsys' low cost alternatives.. it's time to eliminate that problem...
we all know how consolidation benefits the consumer? Can Cisco succeed in making home broadband routers as painful to set up as their enterprise offerings?
Hey, why'd you all get quiet all of a sudden?
Uh, I have to go...
I like LinkSys products because they are functional and cheap. Ciscos products are functional, robust but not cheap. I guess Cisco is getting scared of the competition, and decided to crush them...
As the economy looks to ramp back up again over the next year, consolidation among hardware/software companies should accelerate in 2003. Just like IBM bought Rational recently, there are probably going to be more big acquisitions coming up. Anybody's guess as to who's next? My bet is Sun...
Stop by my site where I write about ERP systems & more
I am sure they will continue to support all Linksys products. It's not like anyone ever buys the competition just to kill them.
Just me, the Voodoo owner... yes yes... I can and will write my own freaking drivers *grin*
I only look human.
My mother is a halfling and my dad is an ogre, so that makes me an Ogreling
Cisco:Hard to configure, very configurable.
Linksys:Easy to configure, not very configurable
In the short term, this will probably be quite good for both Cisco and Linksys, but after a while both entities, if they still exist as separate entities, will start to regret this move.
First of all, Cisco now has a lot more to worry about, and they've have lot to worry about lately what with their stock prices fluctuating and a slowly decreasing demand for networking hardware as more and more IT firms belly up and more of the ones who stay in business consolodating their IT servies through hosting firms and the like.
The consumer hardware market is *very* low margin. There's a reason that they call this stuff 'Commodity' hardware... including networking hardware. If Cisco has to play the commodity hardware game for long, they're going to start feeling like having a company come buy them out as well.
Second, the number of players in the networking field keeps getting fewer and fewer. This seems like a good thing for the companies-- they don't have to compete as hard or do as much R&D to stay at the top. What this means for them in the long run, however, is that they become less able to deal with business crises and the advent of new tech. Just look at the way wireless is taking off right now. If you think this technology is done by a long shot or that there aren't new companies sprining up to exploit it, you should study it a little more. Sooner or later there will be a 'powerhouse' company spring up for an aspect of networking that's troublesome for Cisco, and then they'll have problems keeping up and staying competitive if they cut back right now at all.
The next Slashdot story will be ready soon, but subscribers can beat the rush and slashdot the links early!
Linksys has some odd stuff that I really don't see CISCO holding on to- NAS, battery backup, KVM, etc.
Guess it will come down to if CISCO can leave Linksys alone or not.
III.IIVIVIXIIVIVIIIVVIIIIXVIIIXIIIIIIIIVIIIIVVIII
To increase usability, all CISCO routers will now come with a web interface accessible on the rarely used port 80. It will have a default username/password of: admin/password. In case the username/password are forgotten, CISCO tech support can use their back-up account that they have in all CISCO boxes to access the box and change the admin password. No one will be able to find out this secret account, we're kinda sure of that.
I would imagine that cisco wouldn't do much to change the actual linksys line. I doubt they would build on their router's OS since the whole idea in the consumer market is to have an easy to configure product. Cisco will probrably want to keep a sharp distinction between their consumer products with easy to configure web interfaces (ie the old linksys ones) and their mid to high end corporate products. I do not think that either the consumer needs to worry about products becoming hard to configure, nor do i think that corporate IT needs to worry about a decline in quality of the high end stuff. This merger is not meant to "improve" technology. Its simply meant for cisco to enter a new market. I seriously doubt anything will change pricewise. If it does it would probrably mean cheaper consumer products since cisco has much more in assets and could seem to be in a position to undercut netgear. Just think, now we can have microsoft vs cisco price wars for the home network... Soon we're going to be getting home routing equipment for free if it follow the netscape vs internet explorer model ;)
Does this mean that they will port IOS to the cheaper Linksys stuff, or are we stuck with QOS or whatever Linksys currently uses. Not that it does a bad job, but i'm used to how IOS functions.
Cisco provides outstanding quality networking and communications products for the IT sector of the enterprise. However, with the dot-bomb era of the computing industry, Cisco's shares have fallen drastically as a result of companies not actually needing to acquire Cisco equipment as much as they thought. The effect on Cisco? Over-stocked inventories required price-slashing to remain competitive. Their existing market segment is slow, sustained growth. The Linksys acquisition caters to a dynamic, expanding market.
The reason I say it's the Walmart way is because Walmart provides just about everything you can think of that is smaller than a car - some of the Walmarts where I live actually have the Walmart Appliance section. Walmart sells clothing, food, tools, etc.
Most individuals looking for high quality (cost) goods will not be purchasing their designer fashions at Walmart. Instead, they choose to go to Dillards, Parisians, Eddie Bauer, and other higher quality - smaller customer base distributors. Yet, when you look at it in the end - who makes the most money (by a huge margin)? You guessed it - Walmart.
The vast majority of consumers are middle-class to lower-class individuals. Many companies that have taken a huge beating in the market place are looking for cost cutting measures. 40 Linksys switches or 10 Cisco switches for the same cost? The "Linksys line by Cisco" would be like the "Great Value" Walmart brand. The Cisco native branded equipment, I would imagine, would be for the people who still want to shop at Eddie Bauer, etc.
Linksys is a highly popular choice for cable companies who provide their broadband service because it's extraordinarily cheap with a pretty decent track record. Cisco acquires not only Linksys, but its existing relationship with all of the companies who buy Linksys equipment in bulk. As a result, Cisco gains market share into an arena it previously untapped venture without having to invest the capital to pursue moving into an already crowded arena.
I would imagine the Linksys brand name would stay around for quite a while (much like the legacy of USRobotics when purchased by 3Com) to diversify the two segments of the company for marketing purposes.
The only caveat to this acquisition is the fact that it was a purchase of another company. Many companies which made acquisitions before the dot-bomb crash did not efficiently integrate the companies, and they ended up either being dead-weights or misused to the point of extinction. Only time will tell.
Ayup
I think it'll help Cisco to open up the bottom end of the market. The two companies are in no way competing. I just deployed some Cisco 1100APs at work. We compared them to the MS wireless router and Linksys WAP11. The Cisco easily got twice the range in an office environment than the other two. So yeah, they might cost more but you definately get more. Plus we get the advantage of using LEAP.
The bad news is that those who bought a Cisco access point now have a LinkSys access point for double the price ;(
Great...
Right now we have CatOS (set/clear), IOS (conf t), old IOS (wr mem), the 1900-series menu interface, the HORRIFIC config system from the Aironet series, CiscoWorks Campus Manager, and that Cluster thingy from the 2950's... now add to that whatever Linksys has... yeah its an exciting time to be a network admin.
Ryan Dorman, CCNA Network Communications Specialist Millersville Univesrity
The price for LinkSys will go up. The corporate politics and craziness of Cisco will see to that.
Yes, but, if you want to fix the published security bugs in a Cisco 675, you have to pay $245 to Cisco support.
Maybe Cisco will push IP phones to consumers thru Linksys, at an affordable price.. Big market there!
have you been defaced today?
Call me crazy (OK, you're crazy!) but it seems to me that Cisco is getting a little more bang for their buck here then simply acquiring new market share by finally doing something that investors are conformable with. i.e. Acquisition. ;)
The biggest news here is that cisco will finally be able to enter a complete solution into the content delivery market. A company can provide online content with massive high-end cisco name brand stuff, and use the acquired linksys stuff to give them the other end of the pipeline as a complete package.
As more local telco companies are looking at providing high-speed internet access, this becomes very interesting indeed.
This tagline brought to you by 1500 monkeys in just under 17 years.
I like the Thong song as much as the next guy, but how on earth did Sisqo ever make enough to buy a consumer electronics company?
Heisenberg might have been here.
Linksys makes the best home networking equipment. I mean, just stop and forget everything you know about networking...and think about it from a n00b perspective.
You want something cheap, attractive and easy to setup and use. For those knocking Linksys quality, allow me to let you in on a little secret...they are the best. In the home networking, wireless networking business, Linksys gear rules.
Now yes, I work in wireless networking...but guess what, I don't work for Linksys or Cisco. I work for one of their competitors. Despite my strong sense of company loyalty, I'll still admit freely that Cisco equipment is the best for Corporate networks (duh) and Linksys equipment is the best for Home Networks. People with Home Networks don't care about firewalls, security, layering and routing, they just want their 3 computers online at the same time, with a high speed connection.
btw, before anyone puts words in my mouth. I tried to stress that Linksys has the best quality gear...and they do. I didn't say anything about their tech support, which is "lacking".
Craenor
No you do not have a Cisco AP for 1/2 the price. Cisco/Aironet AP's have a PPC processor and the best wireless cards in the industry. The origional software is by far the most advanced and has the largest feature set including the only default encryption policy I would trust on a network I admin (LEAP has never been cracked unlike straight WEP). In addition they are porting IOS to the AP's so you will soon be able to do all the IOS stuff on your 350 or 1200 series AP. Compare this to a Linksys box which has a very anemic processor, fairly crude software, a weak wireless card, etc and which does not have the horsepower to run IOS. This is Cisco trying to cover the entire product spectrum from 4 port unmanaged hubs to the big routers. The only potential problem I see with this is the same one Cisco has run into when they try to make their own cheap gear, people see the Cisco name and expect the Cisco feature set, so what starts out as a cheap simple product ends up like their home router series, a shrunk version of their big equipment with a pricetag to match.
There are 4 boxes to use in the defense of liberty: soap, ballot, jury, ammo. Use in that order. Starting now.
On the low end, I completely agree. But is anything with a Cisco badge truly priced such that it can be considered "low-end"?
On the high end, I emphatically disagree. Talk to someone who's administering more than one of the platforms you mentioned (3COM, Nortel, Lucent, and Cisco). Ask them which hardware is the most reliable, flexible, configurable (no Windows-only Java programs needed), has the best web site support, and in general, has rarely if ever let them down in a pinch? Their answer will most likely be Cisco.
And also, all you have to do to get routine software upgrades for Cisco products is register for their site, for FREE, whereas 3COM/Lucent/Nortel want you to annually pay for maintenance contracts, and if the problem/bug you're experiencing isn't fixed within that year, well, then, please buy another yearly contract, repeat ad infinitum. 3COM in particular has a history of deliberately screwing customers that had been with them since the beginning, such as promising an eventual fix for a UDP latency bug (a big deal among ISPs at the time because it affected Quake players, for example), but only for "current contract customers" and then about 18 months later, dropping that product (the NetServer) and replacing it with a newer one (the HiPER ARC) that wasn't backwards compatible, rendering all the users that were waiting for the promised fix out in the cold, and thousands of dollars poorer. Many of the people burned by this little stunt switched away from 3COM after this, but others stayed and now couldn't PAY people to take the old NetServer stuff off of their hands - it is utterly useless.
Lucent is better at least, because you can still get old Livingston and Ascend firmware updates for free, you just need to pay if you want software for anything more modern. And even though some of their products have been dead for some time (long live the Livingston Portmaster!) at least the legacy stuff is useful in limited capacity. A PM3
is still a great choice if you want to get a little POP going in an area where v.92 isn't much of an issue due to phone line quality anyway.