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Google, Amazon, Microsoft Go East For Network Gear
theodp writes "Wired's Cade Metz has the scoop on the move away from U.S. network equipment stalwarts, calling it of the best-kept secrets in Silicon Valley. 'Cloud computing is an arms race,' writes Metz. 'The biggest web companies on earth are competing to see who can deliver their services to the most people in the shortest amount of time at the lowest cost. And the cheapest arms come straight from Asia.' Or, as Joyent's Howard Wu puts it, 'It's kind of like buying couches. If you buy one, you go to a retail store. If you buy 10,000 couches, you go straight to the factory.'"
Wow.. really? Huge multinational companies are buying equipment from developing countries because it's cheaper?! What is the world coming to?
So that means Amazon and Facebook and Google has first mover advantage and Apple of all companies have factory capacity, supply chain, capital capacity and multi-app user base advantage? Oh, and Worldcom's old telecom hub.
JJ
I quickly read the Wired article hoping to find a joke but didn't find the punchline...
Dan
I expect to see some typical comment about the possibility of foreign entities being persuaded, coerced, bribed, or forced by a Government agency of the local government to modify the design of the hardware in order to have a backdoor for spying. I'm sure these big corporations inspect their hardware thoroughly. Anyways why does everyone paint eastern governments as entirely evil.
I'll never buy 10,000 switches. But, I can't help but think that it would still be better to leverage the decades of research and knowledge of the big "stalwarts" rather than doing my own designs or using the ripped off designs from one of these "ODM"s. Yea price is an issue, but surely you've got enough leverage to get a good deal.
If all else fails just buy Huawei. You get all the technology of a Cisco for dirt cheap and the added bonus of a chinese backdoor in you r network. Who could ask for more?
It isn't exactly a huge secret that the network guys(as with the PC guys and others) do a lot of leaning on their OEMs and ODMs, especially for their less specialized lower margin gear. That being the case, it isn't obvious why a major buyer would pay Cisco or somebody just to order the hardware from the subcontractor, slap a sticker on it, and get somebody to churn out an English-language manual.
This would be news if the existing 'manufacturers' hadn't already done much of the work of hollowing them selves out into the marketing and branding arms of the contractors who make the hardware. That VAR stuff is exactly what a large-scale customer wouldn't care much about.
Then you're doing it wrong. Cloud is not about who can stuff the most servers in the most racks in the biggest building. That's what everyone is ALREADY doing. Cloud is about the SERVICE - which can in many cases be hosted on big iron.
Meanwhile, we can be sure Azure or whatever it is will come with a nice OOB "management" feature accessible only to certain key groups in China.
I want to delete my account but Slashdot doesn't allow it.
Joyent is being quoted in an article on big cloud players?
I thought they were a niche, expensive virtual/dedicated server provider -- the Starbucks of cloud with the unique selling point being hip graphics/cartoons, all of whom you could imagine going to Starbucks.
(Oops, I just checked, and they moved away from their cool, "CEO is a she" cartoon graphics.)
I'm not a lawyer, but I play one on the Internet. Blog
Or, as Joyent's Howard Wu puts it, 'It's kind of like buying couches. If you buy one, you go to a retail store. If you buy 10,000 couches, you go straight to the factory
Of course what Mr. Wu leaves out is that they are going straight to a factory in Asia instead of the American manufacturers (stalwarts, I beleive the summary called them).
Googe, Amazon, Microsoft are all mega-companies and strive to maximize their profits. However, at record unemployment levels in the tech industry, they claim they can't find US workers and have to bring in foreign workers. Now, it appears that US equipment manufactures can't produce enough equipment and they have to again go offshore.
Again, they can do business wherever they want, but the time has come to for them and their shareholders to either decide they want to be an American company with a world wide presence or a foreign company with a US operation.
Newsflash! The world is round. Asia is to the West of the continental USA
Well then it makes a lot of sense to standardize on cheap, largely the same hardware. As the article points out:
The switches Google was building typically sat at the top of a rack of servers in the data center, connecting the servers to the rest of the network. As Juniper points out, this is only part of the networking hardware used in the data, but it’s a large part.
So the low level, short haul connections use cheap switches. Makes perfect sense. I'm sure they still need the Ciscos and Junipers to interconnect far-flung data centers and to Tier 1 providers like Level 3 and especially the telcos.
People buy Cisco for 2 reasons: the 4 hour service guarantee and because you can interface just about anything to anything else with them. Two things you don't need in a highly redundant monolithic data center.
"Well, good luck finding a judge that doesn't run a bestiality site."
1) Americans want freedom, liberty
2) Americans adopt capitalism as epitome of freedom and liberty
3) Capitalsm leads to stock markets
4) Stock markets lead to shareholders
5) Shareholders have profit motive
6) Profit motive leads to public companies to maximize margins
7) to maximize margins, you lower costs
8) the east delivers lower cost
9) jobs go overseas
10) Americans bitch about employment flight
Lesson: you did it to yourself by equating capitalism with freedom and liberty
And as we all know, there is no risk of a backdoor in equipment from China.
Thanks, for telling me exactly how Cisco and Juniper aren't scaling to meet the needs of Google. By "scaling", and without further details, I assume they mean "selling cheaply enough".
Soon we'll find that the invisible hand will cut off its own wrist given enough chance. Traditional American Companies are too predictable, and are thus incapable of competing with state directed capitalism. this invisible hand seems to be made of 4 middle fingers and a thumb.
Just take a look at their patents - very few of them are for hardware. Also consider the move to the v15 IOS Universal images.
Cisco have known for a long time that hardware suffer from Moore's Law (loses it's margin quickly) and is easily replicated via ODMs. Lifted software features are a lot easier to litigate against.
"We know what happens to people who stay in the middle of the road. They get run over." - Aneurin Bevan
The real news for me here, was that they were using US network equipment, instead of cheaper equipment from elsewhere. I'm honestly surprised!
What seems to be missed in most of these discussions is that this network gear that the companies are buying are coming without software. One of the ODMs selling the gear appears to be moving to providing some software that can be put together to provide the necessary OS to do the networking but it sounds like it's still an effort to get it working.
If you're google, amazon, microsoft, etc., it's probably not too much of a problem to get a group of developers together to put together and maintain an OS to run the hardware but I don't really see many other companies deciding that they're going to put together a OS development group to save a few thousand dollars per router.
"When you sit with a nice girl for two hours, it seems like two minutes. When you sit on a hot stove for two minutes, it
This article is a load of crap. The only difference is that the boxes are being designed by folks other than Cisco, Jupiter, Force10, etc. The parts are the same. Broadcom chips (designed in the U.S.) still dominate.
This is scary stuff. The US has put them selves into a position where 100s of thousands or millions of companies are at risk of being controlled by an off shore country. We need a disconnect switch that can cut off foreign traffic (if we don't have one already) only problem is that instead of just making them with back doors for china's cyber gangs (controlled by the government) they probably make them with self destruct commands, or could be used to cause a cascade event that destroys our economy and much worse I haven't even begun to think of...very very scary indeed!!!!
look to be honest I have seen the "lawyers" and to be honest I would not let anyone from Huawei bid on my contracts either and thats nothing to do with china but to do with quality
the fact that your going to be passing defence department data over those links and you think for one moment someone won't tap that data ?
your very deluded, what you can do is make it harder and one of the first places to look is at the network layer and how to secure that
for example a known problem from years back...
most phone calls from the greek prime minster where intercepted on the network level at a Vodafone switch and guess who supplies Vodafone ?
Huawei
thats enough for me to exclude them let alone all the other problems...
the funny thing is that Huawei have been trying to buy influence by paying old politicians in australia....
have fun
John Jones
Thanks Google, Amazon and Microsoft for depriving more Americans of jobs. Maybe the next time I buy a technology product I will return the favor. Why should I put money in your pocket when you aren't willing to do the same for people like me.
My experience is that while large companies will use Asian companies for some portion of their network, it's never any of the important parts. Let's break this article down a bit.
"Rivers says. “With the traditional enterprise networking vendors, they just couldn’t get there. The cost was too high, and the systems were too closed to be manageable on a network of that size.”"
Note that the first and only real point is 'cost'. The rest is bullshit.
"The Ciscos and the Force10s build their gear with many of those same manufacturers. Google removed the middlemen." ...goes very well with the spin term "“original design manufacturers,” or ODMs". More bullshit.
"Now, the other giants of the web are running into the same issues, and they too are going straight to Asia for hardware."
Presumably the real issue being cost of course. The western manufacturers of course have addressed every other issue that comes up as these are (were?) their biggest customers.
"As J.R. Rivers serves this market with Cumulus Networks, James Liao is doing much the same thing with a second startup called Pica8, offering networking gear that comes straight from the ODMs."
In other words these guys are trying to sell the Asian kit in the west and are trying to show that it's not crap because the biggest companies are using it. There may be a reason that this is "...one of the best-kept secrets in Silicon Valley." it may be mostly bullshit.
"Martin Casado — the chief technology officier of a third Silicon Valley networking startup, Nicira — confirms that the hardware market is shifting to Asia."
Gee..yet another interested party saying that everyone is shifting.
I stopped reading because the rest is about these startup guys that kicked off the article.
blindly antisocialist = antisocial