Cisco Pricing Undercut By $100M In Big Cal State University Network Project

alphadogg writes "The $100 million price differential between the Alcatel-Lucent and Cisco proposals to refresh California State University's 23-campus network revealed earlier this week was based on an identical number of switches and routers in various configurations. CSU allowed Network World to review spreadsheets calculating the eight-year total cost of ownership of each of the five bidders for the project. 'Everybody had to comply with this spreadsheet,' said CSU's director of cyberinfrastructure. 'Alcatel-Lucent won the project with a bid of $22 million. Cisco was the high bidder with a cost just under $123 million. Not only was Cisco's bid more than five-and-a-half times that of Alcatel-Lucent's, it was three times that of the next highest bidder: HP, at $41 million.'"

Comments

I knew cisco was expensive

[Anonymous Coward]

but holy shit! how do they stay in business?

Re:I knew cisco was expensive

[tdelaney]

People who don't get competitive quotes but always buy Cisco because that's what they know.

Re:I knew cisco was expensive

[camperdave]

but holy shit! how do they stay in business?

With luxurious profit margins. As the saying goes "A fool and his money... that's who you want to focus on."

Re:I knew cisco was expensive

[notgm]

by winning more than a fourth of the contracts that ALU wins.

Re:I knew cisco was expensive

[Joce640k]

There's a lot of PHBs who find Cisco to be "reassuringly expensive".

A bit like Oracle, et al.

Re:I knew cisco was expensive

[WaywardGeek]

I'm not sure that was a real quote from Cisco. It looks to me like they simply didn't want the business. In such cases, business file what are called f-you quotes, which are outrageously priced to take into account that the bidder may not currently have the capability to fill the contract, or that it would be defocusing. Priced high enough, they could sub-contract to HP, for example, and still make a lot of money.

That said, I went to our local office the other day and poked my head into the networking closet. I see the same cheap crummy wifi routers I put there before our little company got bought. Right next to them is a Cisco router worth maybe $10-20K. It's worth more than all the computers and related hardware in the office combined.

Re:I knew cisco was expensive

[WillerZ]

It's worth more than all the computers and related hardware in the office combined.

Debatable. It cost more than all the computers and related hardware in the office combined for sure.

Re:I knew cisco was expensive

[EmperorOfCanada]

You mean features like storing data and dishing it back out; or nonsense features like CPLM5 certification?

Plus you are comparing corporate Oracle to Corporate SQL. For most people all Free and Open Source would be just peachy. Most people including facebook. I rarely see the really big big big sites doing anything with any of the Oracley Microsofty IBMy stuff. They usually take Open Source and then roll their own. Sort of shows that the route to success starts with open source and ends with modified open source.

Re:I knew cisco was expensive

[swalve]

It's very possible. If you read the RFPs for some government things, you'll find things that almost no vendor can possibly adhere to. If you are a top tier vendor like Cisco, you likely CAN meet the requirements, but not cheaply. So instead of trying to compete on price, you compete on being able to fulfill all of the requirements in the RFP. You take the gamble that the people analyzing the proposals will nix the cheaper ones as non-compliant, and you are the only bidder left. Or, that the agency will cancel the RFP and rewrite a new one with different or clarified requirements. Then everyone rebids with full knowledge of each others' pricing, and hopes for the best.

Re:I knew cisco was expensive

[erroneus]

That's a fact. It moves data in a highly standardized way. Sure, there are some proprietary Cisco protocols here and there, but for the most part, it's all the same everywhere. Whatever Cisco does, anyone can do.

People somehow believe there's magic moving data over wires. There just isn't. And there's nothing special about Cisco's. Now, compare Cisco to Microsoft. Now *There* is some vendor lock-in. One thing depends on another thing and another thing and another. To move off of Microsoft is mind-numbingly ridiculous to imagine. But Cisco? Nah. You can replace this and that here and there and you'll be just fine. Sure, you might have to migrate away from the use of anything Cisco proprietary here and there, but for the most part? You can take your time and move bits and pieces here and there.

That doesn't quite count if you're talking about Cisco phones... that's kind of an all or nothing scenario there... within limits. One thing is certain though -- Cisco needs to be humbled.

Re:I knew cisco was expensive

[erroneus]

No. That's not true. It takes brain power. There's a wealth of information out there because pretty much, it has all been done before in one form or another.

It seems cheaper in the short run to buy something off the shelf and put it up. But when you keep paying for it over and over and over again, you might begin to realize that people are cheaper in the long run.

Besides that, do you think the likes of Google STARTED out with billions of dollars? How about Facebook and the others like them? They started with some pretty smart people which turned out to be a far better investment than paying for licensed off-the-shelf stuff.

Re:I knew cisco was expensive

[Anonymous Coward]

>You could argue the same for why buy Unix and Oracle when there's Microsoft Server and SQL. The answer is because the expensive one actually has some features.

You don't know what you're talking about. Most companies buy from vendors because they need someone to blame or they just want to pay high paid consultants rather than investing in an actually qualified IT team. Usually its mainly to blame the vendors.

Re:I knew cisco was expensive

[calmdude]

I'm not sure that was a real quote from Cisco. It looks to me like they simply didn't want the business.

Not really, looking at the spreadsheets, it's typical pricing for Cisco. Especially once they started quoting Nexus-backed infrastructure with OTV to stretch layer-2. You'd be surprised at how many people have been biting off on massive OTV and Nexus costs with no competitive analysis. Looks like Cal State just did an objective analysis without marketing hype, and kudos to them.

Re:I knew cisco was expensive

[sa666_666]

I have to completely agree with this. I've been involved with several large-scale RFPs, and this is exactly how it goes. The only thing I'd add is that like clockwork, any party that doesn't win threatens to sue someone. It happens every time. They must be teaching this in business school or something. I've never seen a more childish group of people.

Re:I knew cisco was expensive

[Anonymous Coward]

But you have to understand that there is a quality difference, and a quite substantial one at that. Cisco's gear, while far from perfect, is massively better than any Alcatell-Lucent stuff. Alcatell-Lucent makes one-off routers. They make it, they ship it, they never look at it again. So if you find your bgp crashes every 2 days ... that just becomes a fact of life (I actually replaced bgp peering on an alcatell with a firewall rule redirecting any bgp sessions to a quagga daemon running on linux, which then ibgp peered with the alcatell. This was actually more robust than their own implementation).

I've seen plenty of linux setups doing the same (network/firewall) job as cisco gear, hell I've even seen a freebsd setup that used pf as a replacement for missing routing features in the freebsd kernel with millions of rules total (which worked), but all those setups did have something in common : horribly hard to figure out what they were doing, and the vast majority of them were configured by admins without a clue of networking. This meant obvious holes, and even when it was done competently, made the setup as a whole trivial to ddos. (my remote-bgp solution for the alcatell monsters was one such thing : attack port 179, play around a bit with packet ttl's and the whole network would die. Nobody ever figured that out though).

Cisco's hardware routers, properly configured, are unddossable. The same cannot be said for their firewalls though.

What I'm saying, as a network admin : please, please, please don't install cheap "one-off" equipment as a supposed replacement for quality hardware. And if you do, expect to be quoted at least $100/day more than everybody else for consultancy to fix the mess, and expect it to take a month longer than normal (that still may make cheap network equipment worth it, though do remember than having your network offline every 30 minutes for a month is bound to make customers extremely unhappy, and more consultants won't help). Not because it's not cisco (juniper is fine, though even more expensive).

Re:I knew cisco was expensive

[Fjandr]

Just look at West Virginia's last big IT project and you'll see how Cisco stays in business.

Re:I knew cisco was expensive

[uncqual]

A similar situation also happens (although I have no idea if it happened in this case).

The "preferred" vendor "assists" in writing the RFP. They get it written so they can fulfill it economically while competitors can't. Sometimes this is done by specing features missing from competitor's product or insuring competitors have to spec higher end products to pick up one "required" feature that the "assisting" vendor just happens to include in a lower priced model.

Re:I knew cisco was expensive

[tconnors]

It's very possible. If you read the RFPs for some government things, you'll find things that almost no vendor can possibly adhere to. If you are a top tier vendor like Cisco, you likely CAN meet the requirements, but not cheaply. So instead of trying to compete on price, you compete on being able to fulfill all of the requirements in the RFP. You take the gamble that the people analyzing the proposals will nix the cheaper ones as non-compliant, and you are the only bidder left.

And the people analysing the RFPs aren't *allowed* to use their judgement. We might well know that actual requirements, and we might well know why the RFP was written up the way it was (so we could end up with exactly the same obsolete equipment from an incompetent venduh as last time), but if the best value proposal is lacking 2 of the 4 unnecessary HDs per blade, then it loses 2 points and we have to go the expensive bid with poorer RAM-to-CPU ratio instead. And they're now busy gouging us for port licences because the RFP didn't cover things like that.

It's all about Cover Your Arse and doing things by the book than doing things with due diligence.

Re:I knew cisco was expensive

[mathew42]

Alternatively Cisco's sales people might see it as an opportunity to offer massive discounts.

Re:I knew cisco was expensive

[Melkman]

When we had an RFP for new network equipment Cisco's proposal was twice the price of the next bid. In the end Juniper won the contract. Of all the proposals only the party offering Avaya/Nortel made a judgement error and ignored a few requirements which they could have fulfilled with a bit more expensive kit and still come out as the winner. The requirements were pretty high but not impossible. We had proposals with kit from Cisco, Avaya/Nortel, H3C, Juniper and Alcatel.

If the price for the Cisco proposal was not a real price one wonders why they submit a proposal at all. Writing the proposal costs money and if they submit a f-you quote they know the will get nothing in return.

Re:I knew cisco was expensive

[b4dc0d3r]

You mean features like storing data and dishing it back out; or nonsense features like CPLM5 certification?

Plus you are comparing corporate Oracle to Corporate SQL. For most people all Free and Open Source would be just peachy. Most people including facebook. I rarely see the really big big big sites doing anything with any of the Oracley Microsofty IBMy stuff. They usually take Open Source and then roll their own. Sort of shows that the route to success starts with open source and ends with modified open source.

I had to quote the whole idiocy. Yes, we are comparing Corporate SQL, the kinds people buy. With the license charges, I don't think groups like Google nor Facebook could afford per-core or per-CPU licenses to do what they do.

This branch of the thread is about how Cisco stays in business when bidding 5x the lowest competitor. Not how they stay in business when an open-source router company gives away hardware for free. How does open source have anything to do with the previous argument?

You could argue the same for why buy Unix and Oracle when there's Microsoft Server and SQL. The answer is because the expensive one actually has some features.

Oracle is expensive, and it is great at what it does. It doesn't have a fancy GUI (SQL developer doesn't come close to what you can do with SSMS), but there are several you can buy, which also suck compared to SSMS. At the same time, Microsoft keeps making things difficult. Look at threads where people can't find Activity Monitor in Sql 2008 R2. They like SSMS as a GUI tool, but the new interface is pretty much shat upon.

This is why people go with expensive. There is a feature they want or need, and one provider either doesn't provide it (a decent management interface like SSMS) or keeps butchering it into useless eye candy (like SSMS). If Cisco has the one thing you really depend on, you will pay them.

The route to success starts with a great idea that nobody thought of and executing it well, and at the right time. How you implement it can be on open or closed platforms. There is another route to success, where you throw out ridiculous quotes just to see if someone will bite. Or like Microsoft, offer to sell an OS you don't even have. Or like Apple, pay attention to the things dumb users care about so they develop a fanatical, thoughtless appreciation. There are many routes to success, as it turns out.

Re:I knew cisco was expensive

[b4dc0d3r]

Because of idiots with a massive budget to spend or get cut. The contract was with Verizon, providing Cisco hardware. Someone wanted top-of-the-line, whether it was appropriate or not.

Five days later, state officials signed the $24 million contract with Verizon Network Integration to buy the Cisco routers.

Verizon delivered an additional 100 routers to the state for free. West Virginia officials never asked for the additional equipment -- valued at more than $2.26 million.

Verizon spokesman Keith Irland said the company simply responded to router specifications detailed in the state's bid posting.

"They specified the equipment they wanted," Irland said. "That's what they requested, that's what we bid on. We had the lowest price, and we won the bid for the equipment and related maintenance."

The Gazette-Mail contacted two Cisco sales agents last week, asking whether the 3945 series routers were appropriate for schools and libraries.

"The 3945 is our router solution for campus and large enterprises, so this is overkill for your network," a Cisco representative responded.

The sales agents recommended a smaller router -- with a list price of $487.

Re:I knew cisco was expensive

[RubberDogBone]

Or you bullshit the RFP. Company I may or may not work for may or may not have just landed a Really Big Deal (TM) RFP for a project. The RFP bid we submitted says we're good to go on everything the agency wanted to do and for less than anyone else. It's a LOT of work. I am sure we underbid.

That's fine and all except we can't deliver some of what was in the RFP. Some of it is stuff we could do but don't currently. It'll require some custom software -which is damn near against the law where I work. Everything must be generic. And some is stuff the agency wants that we have no interest in doing, such as handing over some key elements of our IP and giving them access that our own internal people do not have, and so on. And they want resumes for all staff involved in any way with anything.

This is not a "three letter" agency whatsoever. More like your local garbage department type of thing.

We got the job, we clobbered some competitors, and per some corporate VPs, our next task is to ignore the stuff we don't want to do and BS our way out of doing it. Shrug. This is apparently normal. I don't usually see this deep into the sausage-making side of what we do.

Re:I knew cisco was expensive

[joshio]

Source? If Cisco was pitching a solution that was heavy on Nexus, it sounds like they were pitching a different solution than everyone else. If anything, that means that they didn't follow instructions properly, not that they were legitimately that much higher.

Re:I knew cisco was expensive

[erp_consultant]

CIO's and other high level executives didn't get to where they are by taking big risks. They are generally very conservative and play it by the book. When the time comes to make a big decision like infrastructure or database or enterprise software they are not going to make that decision unilaterally, even if they are perfectly capable of making it themselves. They are going to bring in "experts", the ones you refer to as high paid consultants, and have them conduct studies and analysis and come up with a recommendation. The CIO will then almost certainly follow that recommendation. Why? Because if something goes wrong he hasn't put his neck out on the line. He has taken the prudent step of bringing in experts and is following their opinions.

Consultants are not necessarily any smarter than anyone else but they often have the advantage of specializing in a given field. When you hire them they can focus on a single task and not get drawn into office politics or have to split their time amongst several projects at once. Sure, some of them are lousy...just like there are lousy doctors and lousy carpenters and lousy hairdressers. But in business appearing to do the right thing is often as important as doing the right thing.

It's the same reason that many companies go the "packaged software" route, rather than develop it in house. If something goes wrong you pick up the phone and report the problem and the vendor is on the hook to fix it. If you build it in house and your lead programmer quits the next day then what do you do?

But times are changing. For many of the Web 2.0 companies (Facebook, LinkedIn, etc.) buying packaged software like Oracle is prohibitively expensive when you are starting out. So they use MySQL or Postgre SQL and they are very, very good products. In the right hands they can be just as good as anything from Oracle or Microsoft. It allows them to focus capital on other things and bring ideas to market without incurring extra debt. It's a smart move and it has been proven to be as scalable as anything else out there.

Re:I knew cisco was expensive

[garaged]

Wrong, most of the time it is about the money ejecutives can get out of the big contract, most ejecutives dont care about thechnical aspects, just about own revenew

Re:I knew cisco was expensive

[Anonymous Coward]

"Right next to them is a Cisco router that cost maybe $10-20K. It cost more than all the computers and related hardware in the office combined."

There fixed that for ya.

Re:I knew cisco was expensive

[Arancaytar]

The "rich idiot" market is a very lucrative one.

Re:I knew cisco was expensive

[Taco Cowboy]

Oracle is expensive, and it is great at what it does.

Same can be said for Cisco, but ...

If you look at what the competitors are offering, neither Oracle nor Cisco are worth what they are charging - except in very rare case where no one else is offering the type of very specialized feature that Oracle or Cisco has.

And to put it in yet another way - the price Oracle / Cisco charge or their products do not guarantee that shit won't happen - I know of cases where shits did happen when Oracle / Cisco are being employed - and no, I can't reveal the detail, for the parties involved don't want the world to know about it.

Re:I knew cisco was expensive

[amorsen]

They wanted a router which could handle both a T1 (so a slow legacy software router with obsolete interfaces) and a fiber (most likely 1Gbps ethernet). The 3945 is not a particularly stupid choice if those are the requirements and you like Cisco.

Now, split those requirements in two, and you can use a) any old T1 router and b) a random 1Gbps ethernet CPE. a) costs practically nothing refurbished. If you go with Cisco and you're a government agency, you can probably get an ME3400 with advanced license for under $1000. Juniper EX2200C + license is a bit cheaper than that, OneAccess is a lot cheaper.

Extra costs for the 2 router solution: A power bar with 2 outlets and an ethernet cable...

Re:I knew cisco was expensive

[hairyfish]

There's a lot of PHBs who find Cisco to be "reassuringly expensive".

A bit like Oracle, et al.

Let me fill you in on how it works. A manager doesn't care if the cheap solution works just as good, his job is to manage risk. The risk is that either solution fails and he has to front up to his boss. The argument will either be "I got the best kit (best by perception) for the job", or "I scrimped a few pennies and bought the cheaper version". Giving one of those answers during an outage gets you fired, which is why engineers generally don't make good managers (and are also glaringly obvious about there deficiencies in this subject).

Cisco what?

[EmperorOfCanada]

I have always felt that Cisco had the same sort of following as Novell. Senior IT people certified up the wazoo yet unable to explain to me why Cisco was so much better. The bits that leak out of big data people like Facebook and Google seem pretty lacking in the big names. I don't see gear from HP, IBM, Dell, Cisco, etc. What I do see is white boxish or custom gear that they seem perfectly happy with.

Just a guess but my bet is that much of the business that big old companies like Cisco come from single skill IT people combined with kick ass sales people. Salespeople who sell to upper management not to the non Cisco IT people who might fact check.

So good job to the people who didn't blow an extra $100 Million.

Re:Cisco what?

[kqc7011]

Sometimes a company will place a extremely high bed because they really do not want the contract. But they have to bid to stay on the list for future proposals. And if they do get the bid all they have to do is sub it out to a lower bidder and keep the carry.

Re:Cisco what?

[larien]

Facebook & Google have networks/systems designed to work around failure and data loss is a minor inconvenience. They expect to lose a data centre at various times and continue to Just Work. In those environments, cheap grey boxes are fine provided you design appropriately. If you are designing a critical 24x7 system which cannot spread around in the same way (e.g. financial institutions) may have different requirements.

Now, while I'm not saying that Alcatel is less reliable than Cisco, Cisco generally has the reputation of reliability (warranted or otherwise) and so commands the premium.

Re:Cisco what?

[Sepodati]

That's what I was thinking, too.

Re:Cisco what?

[shentino]

Kinda like how microsoft woos PHBs into shoving their crap down IT's throat.

Re:Cisco what?

[bertok]

Unable to explain to me why Cisco was so much better

There are some advantages to going "All Cisco", similar to the advantages of going "All Microsoft" or whatever:

- Huge pool of highly trained talent to pick from. Cisco certified people are easy to get, at both the low end and the high end.
- Good consistency in their products. Excluding their most exotic stuff and the cheapest consumer stuff, pretty much everything Cisco makes uses IOS or is IOS compatible to a degree that you can't tell the difference. You learn it once, and that's it, you know all their products.
- Complete product line. You can start with an entry level firewall and router, and upgrade to multi-terabit telco grade routers without ever having to throw out your knowledge or tools and start over. If it's a digital cable that you can plug into a router, Cisco almost certainly sells a module for it. If they don't, someone sells a compatible one.

From what I've seen, their competitors try to undercut them on price, often successfully, but then the IT department needs two or three vendors to meet all their networking needs. For example, Cisco sells blade-chassis IO modules (integrated switches), and even VMware vSphere "virtual switches"! If you have VMware on HP Blades (very common), then you either go Cisco, or live with the inconsistency. A lot of vendors will sell switches and routers, but not firewalls, VPN concentrators, WAN accelerators, or something. Suddenly, you need IT guys trained ina bunch of vendors' network equipment, you need three different management and monitoring tools, and your op-ex is through the roof. When you call support with a problem, the vendors will all point at each other, and meanwhile your links are down and your users are screaming at you.

On the other hand, $100M seems a bit much, even for Cisco. Sounds like they put a half-assed effort into the bid, and didn't pick the most cost-effective devices or just didn't give the right educational discount or something.

Facebook and Google seem pretty lacking in the big names

They're special, and aren't even remotely representative of a typical business. The way they build infrastructure has more in common with supercomputer design than business data centre design. For example, Google was using 100 Mbit switches when everyone else was starting the upgrade to 10 Gbit!

Re:Cisco what?

[bored_engineer]

Is that true for most public entities, and this one in particular? The state of Alaska, on highway projects for example, simply publishes bids for any comer. There is no list of qualified bidders, though for design work, you need an appropriate person with an Alaska PE. Here's an advertisement for airport facilities in Northway, AK, if you're interested. (The preceding link probably broke sometime after 15 November, 2012, if you're reading this later.)

Re:Cisco what?

[carleton]

Was that a typo? The 100 Mbit switches when everyone was starting to upgrade to 10 Gbit? I would have expected Google to be using 100 Gb when everyone else was starting to upgrade... if it wasn't a typo, could you explain why?

Re:Cisco what?

[hawguy]

the big guys spec out their products and use an oem provider and cut out the "middleman", in this case Cisco. Some of the same stuff from the "white boxish" stuff is made on the same lines as Cisco, et al. This is coming much more popular among the large data center corps.

Unless you're talking about Cisco consumer gear (i.e. Linksys).... which isn't really "Cisco", I'm having a hard time believing that the same technology Cisco is putting into a 6509 switch is also sold as a whitebox unbranded switch.

Do you have a reference for this?

Re:Cisco what?

[PopeRatzo]

There are some advantages to going "All Cisco", similar to the advantages of going "All Microsoft" or whatever:

- Huge pool of highly trained talent to pick from. Cisco certified people are easy to get, at both the low end and the high end.
- Good consistency in their products. Excluding their most exotic stuff and the cheapest consumer stuff, pretty much everything Cisco makes uses IOS or is IOS compatible to a degree that you can't tell the difference. You learn it once, and that's it, you know all their products.
- Complete product line. You can start with an entry level firewall and router, and upgrade to multi-terabit telco grade routers without ever having to throw out your knowledge or tools and start over. If it's a digital cable that you can plug into a router, Cisco almost certainly sells a module for it. If they don't, someone sells a compatible one.

What part of all that is worth a 550% higher price?

Re:Cisco what?

[Revotron]

It's not a typo. Google's entire data model is designed around "cheap and disposable" instead of "expensive and bleeding-edge." The general notion is that they can get 10 custom-built consumer-grade systems for the same price as one enterprise-grade server, and have more processing power and better uptime by distributing their workloads to avoid single points of failure.

That's why they use consumer-grade SATA hard drives. If one breaks, they let it sit there until their next walk-through. Meanwhile, the load is distributed onto a bunch of other similarly-inexpensive servers. You'd be surprised how long an el-cheapo hard drive can last when it never stops spinning.

I have a feeling if Google deployed 10GbE to each server, they'd probably double their hardware costs.

Re:Cisco what?

[djlowe]

Hi,

I'm going to get pounded for this post, but that's OK - this is a subject with which I am familiar, and I'd like to share my perspective nonetheless.

I have always felt that Cisco had the same sort of following as Novell. Senior IT people certified up the wazoo yet unable to explain to me why Cisco was so much better.

Your current "+5 Insightful" upmods notwithstanding, the fact that you need someone else to explain this to you tells me that, by your own admission, you don't have the knowledge required to make these decisions yourself. That alone makes me wonder why your post got upmodded... but, this is Slashdot in the 21st century, so what can you do, right?

If you had the requisite knowledge, I imagine that you'd be posting from that viewpoint, e.g. "I evaluated Cisco's offerings for my company, and after comparing them to other vendors, decided that they weren't worth the premium price for us." Or something similar, rather than stating: "I have always felt that"... this isn't something subject to feelings. IT/MIS is a technical profession, and cost/benefit analysis with regards to network and computer infrastructure is something that is done every day in the real world, though apparently not by you.

The bits that leak out of big data people like Facebook and Google seem pretty lacking in the big names. I don't see gear from HP, IBM, Dell, Cisco, etc. What I do see is white boxish or custom gear that they seem perfectly happy with.

What you don't appear to understand is that Googles and the Facebooks of the world are basically large enough to be OEMs (Original Equipment Manufacturers) in their own right, and have the money and technical resources to pursue that path, and so your attempt to apply their approach to this particular case is flawed. Certainly CSU is large, but they aren't "Google large", when it comes to network infrastructure and servers, and you'll note that they went with a name-brand vendor, rather than rolling their own solution, which makes your statement doubly inane.

Just a guess

You appear to be good at that.

but my bet

What bet? How much? What are the terms? I'm sorry to sound confrontational, but you do realize that such is a null statement? It costs you nothing to say, and there's no penalty if you're wrong. Why not replace it with something more honest, such as "I think that", or, better, in your case: "I believe that"?

much of the business that big old companies like Cisco come from single skill IT people combined with kick ass sales people.

Actually, much of Cisco's success, and sales, come from corporations with mission-critical networks, regardless of scale. They pay a premium for Cisco's hardware, and pay for SmartNet contracts, to ensure their network operations. This may not be worth it to you, but, I have to tell you, their support and logistics when it comes to SmartNet are amazing, and "4 hour parts on site"? The last time I opened a Cisco TAC case for a device so covered, I had a callback in 10 minutes from the person assigned to the case, parts dispatch was under an hour, and the longest delay was on our side: The person that was on-call to open the office (It was a Sunday) didn't answer her cell on the first try, and I left a message with the engineer's cell number, and called him back and gave him her number so he could call her directly to arrange to meet at the office. Once he got onsite, I emailed the backup copy of the router config to him, and he took care of the rest.

Total time was just over three hours, and the following Monday morning everyone came to work and the network was working.

THAT, in my opinion, is worth paying for, when needed, as it was in this case: That office is in Washington State and I'm in New York State.

Now, many companies don't need that, and that's fine. And, based just

Re:Cisco what?

[joshio]

Additionally, Amazon has Cisco Nexus switches in colo space in Sao Paulo, Brazil. Not sure which product line it was supporting, but they had lots and lots of them.

Re:Cisco what?

[Mal-2]

Sometimes a company will place a extremely high bed because they really do not want the contract.
But they have to bid to stay on the list for future proposals.
And if they do get the bid all they have to do is sub it out to a lower bidder and keep the carry.

This is known as a TTFO quote, as in "told to f*** off". It is technically a quote, but you don't expect to win. Rather you look to send a signal that you don't want this piece of business but if someone INSISTS on throwing it your way, you'll do it at your stupidly inflated rate.

This is very often done by finance companies so they can say with a straight face that they offer financing to EVERYONE.

Re:Cisco what?

[HockeyPuck]

Right. But you forgot to mention that they have developed on their own and implemented a very custom software stack.

Not every enterprise out there has the development staff that google does to create such a software layer to be able to commoditize the hardware layers.

Take any established company. Kaiser Medical, Caterpillar, JPMC... while they may have solid IT staffs, the company's core competency is not IT. It's Healthcare, Industrial Machinery or Financial Services. So for them paying for EMC storage or IBM mainframes or Cisco routers and switches is worth their time and money. So they can focus on their core business.

Re:Cisco what?

[Anonymous Coward]

Do you have any evidence to back up the "100mb in the datacenter" statement?
(not all statements are directed at revotron; some are just directed at weird comments elsewhere)

1) they make (some) of their own network gear, and have since at least 2007 [1]
2) when they buy name-brand, they appear to use force10 [2]
3) IOS isn't used in any "modern" cisco gear. They use nx-os, which is derived from their SAN gear and really not much like IOS. [3]
4) let's suppose that google doesn't use 10gb in their DC -- why on earth would they use 100MB? There is zero cost advantage to using it vs 1gb. Here's a link to a very old goog server that for some reason is sold on ebay surplus [4]

[1] http://hitechstartups.wordpress.com/2007/11/19/google%E2%80%99s-secret-10gbe-switch-a-game-changing-strategy/
[2] http://oi49.tinypic.com/xpow81.jpg
[3] http://docwiki.cisco.com/wiki/Cisco_NX-OS/IOS_Interface_Comparison
[4] http://www.ebay.com/itm/110585626008

Re:Cisco what?

[amorsen]

Suddenly, you need IT guys trained ina bunch of vendors' network equipment, you need three different management and monitoring tools, and your op-ex is through the roof.

The challenge with Cisco is that you still need three different management and monitoring tools... IOS and IOS-XR and ASA-OS and NX-OS are similar in that you type commands and things happen...

Disclaimer: I'm a Juniper fan boy.

Re:Cisco what?

[beeudoublez]

Some background: For at least 5+ years, the entire core network for the CSU has been Cisco equipment. With such a high bid, I'd agree that Cisco is saying they no longer want to continue the relationship. (I used to work in networking for one of the state universities)

Re:Cisco what?

[beeudoublez]

So good job to the people who didn't blow an extra $100 Million.

Actually, it looks like San Jose State University 'seceded' and decided to award Cisco $28 million. There is a followup here: http://www.networkworld.com/community/blog/ciscogate To add a little background: I worked in networking for one of the CSU campuses for about 4 years, and worked under Michel Davidoff, the man from the article that ran the vendor bakeoff. The process of choosing equipment vendors has always been extremely transparent, and Michel's approach to the vendors has always been "Okay, these are your taxpayer dollars, show us how you can keep prices low to help your childs education". Training, and support costs were always built into these models, and Cisco actually was the equipment vendor for at least 5+ years. I am *very* surprised that SJSU has gone against the fiscally-sound approach that the Chancellor's office has chosen. I haven't been in the CSU system for years, but isn't this skipping some sort of legal RFP process?

Re:Cisco what?

[HiThere]

He didn't say they used 100MB for new stuff. He said they used it *then* (though "then" wasn't completely specified. I interpreted it as being years ago, though.)

I think his essential point was that they used very-non-bleeding-edge hardware. To the point where there WASN'T any advantage in getting something with lower specs, i.e., not even high-end consumer grade equipment. This is, of course, a moving target which will change over time.

Re:Cisco what?

[LordLimecat]

they make (some) of their own network gear, and have since at least 2007

Either theyre in the chip business, or theyre getting the switch parts from another switch company. And this statement:

It is our opinion that Google (GOOG) has designed and deployed home-grown 10GbE switches.....
Coming off of a blog 5 years ago, does not seem terribly reliable. Especially since you cant just decide out of the blue "hey, why dont we make our own switches"... you need the switchport asics, the switch OS (assuming you want any features beyond "can do layer 2 switching"), and a crapton of troubleshooting. Thats not something you bust out on a whim.

What was Belkin offering just curious

[Anonymous Coward]

I bet Belkin could do the job for a cool 1 million. Of course it wouldn't work, but look at the savings.

Well there you go.

[Anonymous Coward]

Cisco is using American workers and Lucent must be using Mexicans. HP is using H-1Bs; hence the double the cost of Lucent.

Black people and Chinese are OK too, but as long as there isn't any Irish, I won't have a problem.

Re:Well there you go.

[Anonymous Coward]

HP is using H-1Bs;

H-1B is a type of pencil, isn't it? Or is H-1B a virus?

Re:Well there you go.

[Anarchduke]

Awesome Blazing Saddles reference! I only wish I had mod points to bestow upon you.

The bid is based on what they can afford to pay

[PolygamousRanchKid]

On big projects like these, the contractors try to find out how much the customer has budgeted or is willing to pay. Like, by inviting customers to strip joints, etc.

Once they have an idea of how much money the customer has, they adjust their bid to fit it.

Re:Cisco's plan...

[oodaloop]

I figured the difference was in Monster cables.

Re:Maybe raising taxes isn't the only solution.

[The Master Control P]

The idea that American schools don't have enough money is absurd. America spends more per capita on its schools than any other nation in the world.

Now, that all that money is not correctly distributed among schools is clear too. And far more important than that, all the money in the world doesn't matter if mommy and daddy don't encourage and take part in junior's education. Which in makes marginal investments in failing schools pointless, because it's the entire environment of the district that's failing the students, not just the school.

Yeah but....

[blind biker]

...unlike those other companies, Cisco's products are carefully and lovingly fabricated in..... China?

Oops..

Re:Yeah but....

[thegarbz]

Cisco products? They are just overpriced Huawei rip-offs.

Even with 40% off Cisco...

[Anonymous Coward]

We saved close to a million dollars by going with HP instead of Cisco for our campus network equipment refresh.

This was even after Cisco discounted 40% off list (We usually got 30% off hardware 40% off contracts, but Cisco sweetened the deal to 40% off hardware too).

Support on the HP gear is way cheaper than a Cisco support contract too (still with 40% off list).

I wanna see the final cost

[hawguy]

I wanna see the final cost after the project is done and everything is working.

$22M sounds low for a project this of this size, so I wonder if Lucent is planning to make up the difference with consulting fees.

Or maybe I'm just jaded from paying Cisco prices for so long... and also from seeing low-ball bids costing a lot more in the end.

Re:I wanna see the final cost

[Anonymous Coward]

Bingo, we have a winner.

Re:I wanna see the final cost

[imikem]

This. A disparity this size suggests there is more to the story. Cisco is expensive, yes, but Lucent isn't free. Hard to see how they intend to make money on the project.

What Cisco brings to the table is their support organization. If you spend as much time with networking as I do, responsible for upwards of fifty switches, multiple firewalls, IPS, wireless, etc., you learn to appreciate being able to open a case and get a knowledgeable person on the line inside of 15 minutes, and replacement hardware next day without jumping through hoops.

I've tried HP and Dell network hardware at various times, and came away unimpressed. Servers sure, but they should stick with that IMO. Haven't dealt with any Lucent gear since 2000 (some modem aggregator IIRC), so can't speak to them directly.

Re:I wanna see the final cost

[ivrbobo]

I wouldn't praise Cisco support too highly. We had an issue (low, but constant impact) recently which stretched into months. There were 3 pieces of equipment which were implicated based on packet captures (where they could be taken was limited, so the suspects were down to FW, Switch, and load balance). We needed 3 separate tickets, even though it was all Cisco equipment. As each tech was working from scratch, it took quite a while for each to get up to speed on the issue. Scheduling didn't help, as it seemed difficult for some of them to synch up with our admin. Eventually due to a tip from Verizon, our admin stumbled on the issue himself (FW interface had spontaneously switched from auto to half-duplex).

Re:I wanna see the final cost

[imikem]

A support tech didn't notice that an interface got set half duplex? Doing a "show interface" seems about the first thing to check. WTF?

Re:I wanna see the final cost

[AF_Cheddar_Head]

Sure Cisco support is great until the only fix is an IOS upgrade.

Want VSS support for your 6509 switches, sure, upgrade your IOS but we removed support for your CSM modules so you need to buy ACE blades. We don't care that you bought the CSM modules six months ago, just give us more money. True story and no it wasn't spelled out on the roadmap.

Re:I wanna see the final cost

[T0nz0fFun]

I actually think Cisco support is good. We added VSS support on our 6509 switches and our 6513 switches and we didn't have to upgrade the IOS. We did have a blade go out in one of our 6513's. Cisco helped us identify the bad blade, and then had a replacement in our hands in 3 hours. For us, that kind of response is an absolute must. We also had Extreme core switches which have been replaced with Cisco's because of higher failure rates and slow support response.

Re:I wanna see the final cost

[AF_Cheddar_Head]

Agree that the support from the TAC is excellent. The problems is more with product roadmaps and their propensity to remove support for in production hardware from new versions of IOS. Those CSM module is mention were less than 1 yr old at the time and now an new version of IOS comes out that drops support for them. The only choice was no VSS or buy ACE blades for approximately 40K each plus maintenance.

Re:I wanna see the final cost

[T0nz0fFun]

Yea, I agree that doesn't leave you a lot of options. That would aggravate me as well.

Re:I wanna see the final cost

[evilviper]

Knowledgeable people? Cisco HAS THEM, but they sure aren't the guys your call reaches. And then, they disappear for a week, the day after taking your case, and you've got to get it switched to another low-level idiot.

One employer I had woulld rely on Cisco support to tell them how to configure anything they wanted, rather than ensuring good people were in-house, or having a lab environment... I was unlucky enough to have to explain to my boss, over and over, that 5 cisco techs told me the confiiguration I came up with wasn't possible, wouldn't work, and that no equipment they knew of could do it... Since my employer really had no choice but to NOT transition their network at all, they gave me the go ahead to try the configuration after hours, and low and behold, everything worked exactly as I expected, and exactly as they said it absolutely would not.

When Cisco sent me a survey for follow-up, I explained in-detail how incompetent their techs are, and how much of our time (and money) they wasted. After that, I must admit, we got much better support, for a while...

In general, outside support is a nightmare, and the high price of Cisco doesn't make it any better... They're cutting every corner they can.

Re:And?

[sribe]

Cisco is like Oracle. They don't need to discount their prices.

Eh? Oracle discounts, heavily. You only pay "list" to Oracle if you're a small, unimportant customer. The big fish get up to something like 99% off when Oracleewants to lock out a competitor.

Huawei

[Art Challenor]

What was the Huawei bid?

Re:Huawei

[fa2k]

For some reason they said they would do it for free if the university started doing military research

Re:Cisco's plan...

[fuzzyfuzzyfungus]

Only a fool would do an important networking job without monster cables. Do you know how much packet fidelity you can lose if stray RF gets into your fiber?

Re:Why are the modpoints broken?

[fredprado]

I don't know if it is a bug or an intended feature but it happens from time to time.

Re:Maybe raising taxes isn't the only solution.

[Joce640k]

Sure, but doesn't most of it go on luxuries and fancy facilities to attract students rather than actual teaching?

Sports facilities better then most professional teams, plasma TVs in every dorm room, etc.

Re:Maybe raising taxes isn't the only solution.

[Anonymous Coward]

The idea that American schools don't have enough money is absurd. America spends more per capita on its schools than any other nation in the world.

Now, that all that money is not correctly distributed among schools is clear too. And far more important than that, all the money in the world doesn't matter if mommy and daddy don't encourage and take part in junior's education. Which in makes marginal investments in failing schools pointless, because it's the entire environment of the district that's failing the students, not just the school.

And it doesn't matter if the per capita spending is great, if the individual spending is too low in some areas, and high in others, or completely unrelated to education spending at all.

That's the real problem, too much is going into things like standardized tests and football stadiums, and even into disability services. Yes, I do support spending on the disabled children, but don't ignore how much it distorts the cost picture.

Who wrote the offer?

[garry_g]

Wondering, was the offer directly from Cisco? Did the person who designed/selected the gear know what they were doing?
Just by selecting the wrong gear, prices between different Cisco gear can already differ by a factor of 2-3 ... e.g., we just had a project in which a company campus with something like 20 Gigabit switches (24/48 ports, access layer) and a core with 10G ability to feed to those as well as cover the DC with redundant 1G ports ... going with the usual suspect (6500) as core switch with line cards to supply up to 16 10G ports and 96 1G copper ports would have been more than twice the price than the alternative we chose, Nexus 5548 w/ two 2248 FEX chassis.
Also, instead of using overpriced (to say the least) Cisco SFP/SFP+ modules would have run the total bill up even more ... (total of 44 SFP+, 42 SFP, with original Cisco SFPs that would add up to around 50k€ - would have been a third of the whole project budget. Using OEM/compatible modules was around 5k€). Assuming a large quantity of fiber ports in such a project, the optics alone may quickly add up to the factor mentioned above ...

And maybe they just didn't want the job...

[raist21]

I know several contractor's who consistently try to bid themselves out of jobs when it comes to dealing with Universities.
Not all of them are technical contractor's admittedly, but I've heard similar stories from various fields.
Most of the time they say that the amount of interference from school official's and various professor's makes the work a nightmare and not worth doing at any price.
I wonder if Cisco figured "the juice isn't worth the squeeze" and intentionally over inflated their price to ridiculousness in order to avoid the entire project.

price spread

[bored_engineer]

I'm surprised at the price disparity. It's not like Alcatel-Lucent is a cut-rate supplier.

My employer recently bid construction of a project I designed, and all of the bids were within 50% of the low bidder. When I was working as a consultant, I recall losing to the low bidder by 100s on a project worth $80,000. Do others see a price spread as wide as this one?

Perhaps somebody at Cisco misread a spec?

Re:price spread

[gagol]

I managed a website project where off-the-shelf customized would cost us around 10K$ but the boss went with full-custom-tied-to-one-supplier for 60K$... go figure.

Re:Maybe raising taxes isn't the only solution.

[Onuma]

Mommy and daddy don't have a clear understanding about money or economics any more than congresscritters or teachers do. If they did, they'd teach their children that formal and informal educations combined are the only way they'll really have a successful future beyond a "pawn's mate".

There are multi-level failures within the American education system. It starts with parents ultimately not understanding how to really help their children succeed and it is further exacerbated by poor management of money from local agencies all the way up through the federal Department of Education. There are also societal values at the lower- and middle-classes which can cause education which is received to be ineffective; take for example the middle-class priority of being good at a sport and getting scouted for a team in high school over academic and economic educations, or in poorer neighborhoods the priority on being tough or able to survive on the streets instead of learning something in school which might elevate them out of that cesspool.

If your family can't teach you, your teachers can't teach you, and the gov't can't teach you...then how do you learn? Vicious cycle, if you ask me.

Re:And?

[nurb432]

They both do all the time for enterprise customers.

If you are paying 'list', you are either a fool for not asking, or too small for their business in the first place.

They're gonna regret it!

[Tempest451]

I'll admit, Cisco backbone gear is crap, but their campus-level equipment is pretty reliable. The real value comes in the fact that Cisco is so prevalent and so many people have the certs and the fact that Cisco does have seasoned support system. Lucent has been losing market share for years and it shows, you may get the cheaper gear, but you will get what you pay for.

Re:Maybe raising taxes isn't the only solution.

[NotSanguine]

America spends more per capita on its schools than any other nation in the world.

Actually, we rank fourth

And on a percentage of GDP basis>/a> The US ranks 37th, tied with Estonia.

Re:And?

[Anonymous Coward]

Oops, that is Salesforce.com (whatever, they're all basically the same):
http://www.businessinsider.com/salesforce-oracle-postgresql-2012-10

Re:Maybe raising taxes isn't the only solution.

[bored_engineer]

TVs? Clearly, I went to school in the wrong decade. I can remember when my Alma Mater got telephones. (Truth is, they were late to the game, and only installed telephones in response to an instance of rape, where the attacker broke into the dorm room after protracted effort. Thankfully, he also went to jail.)

Because I was too cheap to buy a TV while at college, I lost the habit of nightly TV viewing. Though I own a secondhand set now, I can't recall the last time I turned it on.

Re:And?

[Anonymous Coward]

They're doing this because Mark Benioff is Larry Ellison's ex-protoge, and their relationship took a turn for the worse and now they're in a gigantic dick measuring contest. Goes something along the lines of this-

Benioff (Presents Steve Jobs Style) "We are the original cloud, there's 'no software' and it's all a 'social enterprise"
Larry (Presents Balmer Style) "We do cloud too, and we're Oracle, so fuck you".

What a bunch of wankers (worked on SFDC and Oracle)

Re:Maybe raising taxes isn't the only solution.

[bored_engineer]

What happened to the link? Why didn't it show up when I previewed the comment? That should have been to http://www.uaf.edu/ .

Re:Alcatel not worth US$ 22M

[cusco]

From the sound of the Alcatel, it makes me wonder if they come out of the same factory as LG switches. Upgraded the firmware on a dozen of them, and the uplink ports on two of them died, never to be revived. Uplink ports on a dozen others have failed or gotten flaky, and some of them drop downstream connections at random times. Sixty six switches, and over a dozen of them have failed fully or partially. Pretty horrible ratio.

There is that old saying...

[chill]

Cisco, you can get better but you can't pay more.

Re:There is that old saying...

[GameboyRMH]

D'oh, beaten.

Re:Maybe raising taxes isn't the only solution.

[bored_engineer]

huh! That's even less than your source says we spend on the military, which initially surprised me. But, my first question was: Did they account for spending by the states in their estimate? Further, in trying to sort out the source for the data, the site seemed to repeatedly cite itself in an orobouros-like fashion. Do you have another source?

Re:Maybe raising taxes isn't the only solution.

[Impy the Impiuos Imp]

Forth isn't bad. And the GDP one is useless because that's not a correct measure*. How much do we spend as a percent of money we spend on Halloween costumes each year?

* Government also likes to borrow, thinking in terms of percent of GDP. As the economy grows more efficient, they can inhale a big chunk of that efficiency as more borrowing. Yet it seems reasonable to the clueless because the fraction of GDP remains constant.

Re:Maybe raising taxes isn't the only solution.

[Impy the Impiuos Imp]

Actually, Forth kind of sucks. I prefer LISP.

In line with expectations, really.

[tibit]

I'm partial to HP gear, and I always claimed that it has quite decent TCO even in very small scale deployments (we have 5k worth of gear, not 40M). People who buy Cisco must be getting a lot of free pussy or something.

Re:In line with expectations, really.

[hawguy]

I'm partial to HP gear, and I always claimed that it has quite decent TCO even in very small scale deployments (we have 5k worth of gear, not 40M). People who buy Cisco must be getting a lot of free pussy or something.

Yes, in a small deployment, HP is very cost effective and works well. Even Netgear works well if your budget is $5K.

But in my experience, Cisco does win in manageability and scalability of larger networks. And if things stop working, you can get a knowledgable engineer on the line quickly. We're a pretty small customer (~200 switches), and when we ran into a weird problem with some switches in our environment caused by an IOS bug, we got a custom patch for the problem, which Cisco rolled into the next IOS release.

Re:In line with expectations, really.

[amorsen]

My experience with HP Procurve gear is that it does exactly what it says it does in the spec sheets. The software is rarely buggy, at least not uselessly so, and the hardware is very reliable -- and if it does have problems, they tend to show up from the start, not a year later. The challenge is that there are so few features. I haven't tried the 3com stuff that HP bought yet; back when it was 3com it was quite lousy.

Re:In line with expectations, really.

[majortom1981]

Do not forget HP'S lifetime warranty on most switches. that's why we use them.

Re:In line with expectations, really.

[tibit]

Yeah, say what you want, but they have got reliability engineering down pat. They know how to make their shit last, that's true.

Re:Alcatel not worth US$ 22M

[quetwo]

From the look of it, it seems the bid required them to front-load 8 years of maintenance for software and hardware. Cisco usually wins bids by basically giving the hardware away, but charging full for their maintenance (Smartnet). By forcing them to front-load it for such a long time, they had no way to make money on the back-end, which is probably why it was so expensive.

Re:News: Cisco is overpriced

[cbhacking]

More News:
The sky is blue

I live in Seattle, you insensitive clod!

Re:And?

[Rytr23]

99%? Doubtful.. But hefty discounts indeed, and Oracle is still obscenely expensive

Re:Maybe raising taxes isn't the only solution.

[Jeeeb]

I wouldn't rely on nationmaster.com for reliable, up-to-date information. That data is from 1998 and converted into US dollars based on 2001 PPP measurements. I would not say that is the most reliable source of information on the current state of education spending. According to that Thailand is outspending countries like South Korea, Singapore and Belgium on education..

Re:Maybe raising taxes isn't the only solution.

[zill]

You clearly don't know what "per capita" means.

Re:Cisco's plan...

[mrmeval]

Try keeping stray RF/ESD/etc out of TOSLINK transceivers, even Toshiba brand is crap. Yes it's plastic fiber but this crap can't do 1 mbaud. It struggles at 125k baud. So for our unfortunate application we had to redesign the item with shielding. The original receiver/transmitter pair were shielded but they cost reduced them. I can't see how they can transmit audio much less other data.
The other problem with plastic is it will transmit RF/ESD into the transceivers if it's not exactly perfect and moisture free.

We had better luck with glass fiber except when the outer protective sheath was moisture laden plastic.

It's a niche communication product.

 

Re:Maybe raising taxes isn't the only solution.

[bored_engineer]

Hilarious. I recall, for the brief time I was studying CS, two students employed in one of the CS labs expounding, respectively, on the virtues of FORTH and LISP. Sorry that I don't have a mod point to toss your way right now.

Re:Maybe raising taxes isn't the only solution.

[Fjandr]

Indeed, but that just further illustrates the point that the idea they don't have enough money is absurd.

Re:Maybe raising taxes isn't the only solution.

[GofG]

no MMOs worth playing? May i pitch LOTRO to you?

It has a really, really good Free2Play model. Perks are bought with Turbine Points, which you can buy with real money. Perks like expansion packs, bag slots, premium classes, the riding skill, and quest packs. But you also earn TP in-game by accomplishing Deeds. An example of a deed might be, Kill 30 goblins. You'll find that during the course of playing the game normally, you'll automatically accomplish many deeds. by the time you run out of content, you'll just about have enough TP to purchase more content (by design), with enough left over for maybe a bag slot and a better mount.

The gameplay itself is incredible. beautiful DX11 graphics, excellent combat with exemplary endgame comparable to EQ1 pre-LoD. Pvp is lacking, but still about as fun as WoW BGs. And the lore is second to none. Even "kill 10 goblin"-style quests make you feel like you're actively participating in some greater story, and the sheer detail of everything is staggering.

exactly.

[Anonymous Coward]

You either pay for the brainpower upfront with pre-configured hardware/software, or make up the difference with smart (but expensive) people. The trick is which lasts longer, or is a better long-term investment.

I could employ a crappy IT admin who only knows windows, and pay him $40k and the enterprise Win suite and license seats for $20k total; or a decent linux admin at $60k and virtually unlimited server and seats running CentOS and Ubuntu for $0.

This is of course a very simplified way of seeing things. There are many more variables to consider, such as how competent is the end-user with computers?

Re:exactly.

[WalkingBear]

The real difference is that at the end of the year, with MS, you still have closed software being managed by a mediocre admin and are pretty much limited to what the vendor wrote in the software and what your admin can find on google.

With the second option, you've still spent $60k, but you started with a much higher level of base competence and things usually go up from there. At the end of the year you have many more options and much more flexibility in what you're capable of, IT wise and business wise, with that higher level of competence.

I'd much rather, and when it's been my decision to make have always, put my money in people rather than software licenses. If I need to solve a problem "right now!", then I'm likely to buy a solution that solves that problem "right now!" but even then with an eye towards what problems will that solution allow me to solve later.

Re:exactly.

[Bacon Bits]

The real difference is that at the end of the year, with MS, you still have closed software being managed by a mediocre admin and are pretty much limited to what the vendor wrote in the software and what your admin can find on google.

With the second option, you've still spent $60k, but you started with a much higher level of base competence and things usually go up from there. At the end of the year you have many more options and much more flexibility in what you're capable of, IT wise and business wise, with that higher level of competence.

The logic of this argument is quite common here on Slashdot, and that logic always escapes me. Everybody seems to acknowledge that a talented Linux sysadmin costs more than a mediocre Windows sysadmin. What I fail to understand is why a business is only presented with those two options. In reality, a business cares about money first and foremost. And the cost of your salary is usually quite a bit more than the cost difference between Windows Server and Red Hat Server. The reality is that a business is going to choose between a talented Linux sysadmin and a talented Windows admin (because they're willing to pay for talent) or they're going to choose between a mediocre Linux admin and a mediocre Windows admin (because they're not).

Slashdot seems to think there's no such thing as a talented Windows administrator. That's complete and utter bullshit. The concepts of administering Linux are not significantly different than those for administering Windows. I would go so far as to say that if you're unable to secure and manage a Windows network, you shouldn't be a sysadmin at all on any operating system. Windows is easy to administer. You read and reference the Resource Kit, research and follow best practice, and you will be absolutely fine. Just like on Linux. If you cannot do these things as a sysadmin, please quit your job. You're making the rest of us look bad.

The argument is like saying, "well, the average COBOL programmer costs quite a bit more than the average C programmer... clearly we should go where the talent is and program in COBOL!"

I also find it completely baffling that Slashdot seems to think that because you go with Linux, the business software you're going to run will use open source, too. More than that, that just because you hired a talented sysadmin you also hired a talented software developer. In my experience, sysadmins make horrible software developers because they do not develop robust solutions that adhere to development best practice. You end up with buggy, badly performing, un-maintainable software that may or may not function correctly. Similarly, software developers make horrible sysadmins, because they constantly do things that make their system work and compromise the integrity of everything else. You end up buggy, badly performing, un-maintainable computer systems that may or may not function correctly. The mindsets required to properly do software development and system administration are entirely different, and to do anything well requires focus and dedication. I would not look for the same talent in the same person any more than I would look for a writer to also be an editor, or an actor to also be a musician. Yes, it can be done, but generally it is the exceptions that prove the rule. Once a person chooses one path, they seldom cross to the other again.

Re:exactly.

[Melkman]

While I agree that there are talented Windows administrators just as there are talented Linux administrators the rest of that paragraph is nonsense. The concepts differ significantly between the two operating systems once you look further than the "OS manages hardware resources and provide services" part. And you will not be fine one a more than trivial setup by just reading the books and following best practices. In fact, in my opinion that is one of the things that makes the difference between a mediocre administrator and a good one. The good administrator has a good insight in why things are best practice and knows when to deviate from them while a mediocre one just follows the rules. And a good Windows administrator is just as scarce and will cost you about the same as a good Linux administrator. But with the Windows administrator you get the added cost of licenses.

.

Re:exactly.

[LodCrappo]

> The argument is like saying, "well, the average COBOL programmer costs quite a bit more than the average C programmer...
> clearly we should go where the talent is and program in COBOL!"

No, unless you include in your comparison the part where C costs hundreds of thousands of dollars in licensing fees and COBOL is completely free.

As the real choice is between paying for licensing *and* and competent admin or simply paying for a competent admin, you argument seems mostly like fail.

Re:exactly.

[Bert64]

The most important difference is that while a mediocre admin will be able to keep a windows network limping along, it is likely to be extremely insecure and suffer from all manner of other problems.
An expensive competent admin on the other hand will be able to do a much better job regardless of the technology they use, although it would be foolish to spend a lot on proprietary software when your admins are competent enough to do a better job using free software.

Re:exactly.

[Bert64]

Talented windows sysadmins are no cheaper than talented linux sysadmins, but you still have the added cost of windows and all the other proprietary third party software it requires...
And while competent admins will be able to scale up to many hosts quite easily, software costs just escalate as you add more hosts.
Also a competent windows admin will spend a lot of time trying to mitigate serious windows design flaws...

Following best practices generally does not work, or is not practical... I have pentested many windows networks where the admins have followed all the best practices and there were still ways to compromise the network.

Re:exactly.

[hairyfish]

And a good Windows administrator is just as scarce and will cost you about the same as a good Linux administrator. But with the Windows administrator you get the added cost of licenses.

And added benefit of more stuff working with it. A small but important point that always seems to be omitted in this place.

Nicira eats Cisco's breakfast.

[Shempster]

No doubt Nicira's Network Virtualization Platform will hurt Cisco unit sales now and in the immediate future. Premium Cisco h/w prices will be ending real soon. At least with non-hypervisor-aware models. With VMware's recent acquisition of Nicira, and Cisco expanding its partnership with Citrix, say goodby to the VMware/Cisco alliance. SDNs will virtualize most, if not all, gigantic data centers and enterprise networks in short order. But who will dominate the transition?. Regardless, I wouldn't bet against Cisco's ability to survive and thrive through these coming changes. And I don't think you should stop studying for your CCIE, it that's something you're doing. You should find out as much as you can about Nicira's SDN controller s/w.

VMware is making some bold but good moves here. I wonder why the damn day traders and insiders have recently abandoned VMW stock. One market analyst writes an article about "the server virtualization market being saturated" and they panic and they all bail out. Very very tricky of you, you god damned short-term volatility creating bastards with your inside tips from column writing analysts.

Lowball bids should always be a warning

[Sycraft-fu]

There's a big difference between being cheaper and being a fraction of the price. Maybe it means that you are getting screwed by the expensive vendor, but it can mean you are getting screwed by the cheap one instead.

There are big, big differences in the quality of supposedly "high end" network gear. Some of it is crap. It can't handle the big loads it is supposedly designed for, its software is buggy, hardware prone to failure, support sucks, etc.

Not saying this is the case with Lucent stuff, I dunno, just saying that you can really fuck yourself if you just look at price for a feature set, rather than how well the things actually perform.

Also you have to be careful with project bids because lowball bids are often deliberately leaving important shit out to screw you later. They lowball it because they know they'll make it up and more on various "addons" that magically are needed.

Construction companies are famous for that. Their bids are wildly unrealistic and it ends up costing many times the bid price in the end.

Re:And?

[joshio]

It all depends on who you are. At my last company, the local Cisco account team wanted us as a reference account. Our discount from Cisco (before distribution and the partner took their cut) was 59%. Our final discount was 55% or 57% (depending on whether we went through disti or direct from Cisco).

At my current company, our discount from Cisco (again before disti and partner) is 55%. Our price after partner and disti is 47% (yes, our partner is taking a ridiculous cut).

The problem is that most customers don't have any idea what list price is, and so they have no clue whether they are even getting a reasonable price. Sadly, Cisco, along with their partners, do their best to hide this information from their customers.

Re:News: Cisco is overpriced

[ArcadeNut]

The Sky is still blue, you just can't see it through all the clouds :P

Re:CISCO

[Corbets]

How was this post modded +5? It's barely understandable and full of conjecture (must have been an executive order, etc.).

Am I missing something, or did today's mod points go to a random number generator?

Re:Maybe raising taxes isn't the only solution.

[NotSanguine]

huh! That's even less than your source says we spend on the military, which initially surprised me. But, my first question was: Did they account for spending by the states in their estimate? Further, in trying to sort out the source for the data, the site seemed to repeatedly cite itself in an orobouros-like fashion. Do you have another source?

Is data from The United Nations acceptable?

Re:Maybe raising taxes isn't the only solution.

[erp_consultant]

This is a typically American problem - the notion that you can simply throw money at problems and they will go away. The war on poverty has met the same fate. We have essentially the same proportion of people below the poverty line today as we did in LBJ's time despite spending massive amounts of money on it.

If you are a teacher where would you rather work? In a nice, safe suburban school or a dangerous underfunded urban school? The fact that the suburban school also has more money only exacerbates the problem even further since the money that schools get is largely based on the tax base. Neighborhoods with big expensive homes pay more property tax and the schools there get more money. And tend to attract better teachers. So if you are a parent the goal is to move to one of those neighborhoods so that your kid can attend one of those schools. And the cycle continues.

Re:Maybe raising taxes isn't the only solution.

[mellyra]

This is a typically American problem - the notion that you can simply throw money at problems and they will go away. The war on poverty has met the same fate. We have essentially the same proportion of people below the poverty line today as we did in LBJ's time despite spending massive amounts of money on it.

Keep in mind that poverty is first and foremost a measure of inequality not a measure of well-being - the definition usually used for industrialized countries sets the poverty line at 60% of the median household income (absolute definitions of poverty are only used for the poorest countries).

The only way to get less poverty is by reducing inequality in incomes - if you want to achieve this via redistribution you have to increase the amount given to the poor faster than median household income increases to see any effect. If the money you spend on fighting poverty just keeps track with GDP/median household income/... you can't expect to see any change in poverty.

Re:Maybe raising taxes isn't the only solution.

[TheRaven64]

Don't be too hard on him, he went to an American school.

Cisco has a nasty propensity

[kilodelta]

To price itself out of the market. I recall when I worked at the RI Sec of State's office we did a major move of several units within the department to a new space in a different building. I had to go out and spec pricing for switches, routers, and security gear. For basic core networking I looked at Cisco and HP. For the features I required, namely easy management, VLAN, etc. both offered it but the Cisco gear was 3 times the price of the HP. Cisco essentially thinks that because it is the predominant vendor for networking hardware that they can charge a heavy premium. They have also bought up competitors whenever they could to limit the market.

Re:And?

[sribe]

99%? Doubtful.. But hefty discounts indeed, and Oracle is still obscenely expensive

Not doubtful at all--documented when they were sued by government agencies for violating contract terms that required the best price be given. I can't remember if it was 95% or 99%, but it was huge. In essence, if they want your business badly enough, they'll only charge you a tiny fraction of the "list" price. Then of course they will proceed to ream you on maintenance renewals...

Re:And?

[sribe]

Then why is facebook trying to hire a shitload of PostgreSql programmers?

Because Oracle only gives the big discounts for the purchase and then proceeds to ream it customers/victims on maintenance?

Not apples to apples, or even close.

[Above]

Reading the article it's easy to see that there was a huge discrepancy in capabilities, at least to anyone familiar with the various product lines. Cisco proposed a very high end solution, for instance offering up their Nexus solution for the data centers. Alcatel-Lucent simply doesn't have anything similar, although they could build a fine data center solution with slightly less bells and whistles. HP, well, they make some great switching devices, but their L3 routing capabilities are woefully short of both Cisco and Alcatel-Lucents. In fact, that's my biggest clue something went wrong here, if an HP solution is being compared to Nexus, well, that's about as far on opposite ends of the networking spectrum as you can get.

These bids were not at all for the same thing, which tells me the university did a very bad job of writing the RFP. If you put out an RFP saying "I need a car that can take 2 people 100 miles" that spec can be met by a Lamborghini Aventador and a Nissan Versa. The reality is probably neither are appropriate for someone who wants a good value, middle of the road solution.

I have no doubt Cisco could offer up a solution with the same capabilities as Alcatel-Lucent or HP for a competitive price, and no one knows why they didn't do that here. Also, even with similar hardware capabilities speced Cisco software has a lot of features the other vendors simply do not have. Are they worth millions extra? Probably not, but they are worth some extra. If the university had competent people writing the RFP they could have pointed to features that reduce manpower needs and gotten more appropriately priced equipment.

Having written and reviewed a number of RFP's, one of our criteria was the spread on the responses. When it is this large something has likely gone wrong with the RFP process, and it needs to be rebid with better specifications. Back to my car example you can throw in things like it needs to run on regular gas (no more Aventador, or other high end cars), or that it needs to have at least 15 cubic feet of trunk space (no more Versa), and put yourself in a much more reasonable range.

Rather than picking the low bid here the university needs to take a serious look at their requirements, and put out a revised RFP.

Re:Not apples to apples, or even close.

[Anonymous Coward]

One interpretation can be
"These bids were not at all for the same thing, which tells me the university did a very bad job of writing the RFP."

Another interpretation can be "That the university did an EXCELLENT job with the RFP and only put in it functional requirements that were needed. Cisco may or may not have a less expensive solution and decided to respond with what they wanted to sell"

Re:And?

[AF_Cheddar_Head]

Same with Cisco. The real profit for Cisco is in SmartNet maitenance fees, 22.5% each and every year you own the box. HP sells lifetime maintenance with their boxes. Huge difference in lifecycle costs. If you are buying generic switches and routers for the comm closet HP is the way to go. Only use the fancy boxes from Cisco/Juniper at the boundary and maybe in the network core where the fancy stuff MIGHT be needed.

Re:And?

[sribe]

Same with Cisco. The real profit for Cisco is in SmartNet maitenance fees, 22.5% each and every year you own the box. HP sells lifetime maintenance with their boxes. Huge difference in lifecycle costs. If you are buying generic switches and routers for the comm closet HP is the way to go. Only use the fancy boxes from Cisco/Juniper at the boundary and maybe in the network core where the fancy stuff MIGHT be needed.

Wow. Cisco seems really overpriced--essentially re-buying at retail every 4 years. On the other hand, HP seems to be way too cheap on this. (Maybe they're just figuring that lifetime will really only be a few years between upgrades?)

Re:Alcatel not worth US$ 22M

[AF_Cheddar_Head]

Cisco can fail on firmware ugrades too. We had bunch of 3750s to update and the first three all bricked. Turns out Cisco had a bad batch that the upgrade code would ID as counterfeit. Cisco replaced 25 production switches for me without asking for the old one back.

Maybe it was a mistake...

[pdclarry]

I haven't seen the suggestion yet that Cisco may have just made a calculation error or misread the specs. Likewise for Alcatel. Both the high and low numbers seem out of line to me. The remaining bids are in the middle, closer to each other. Probably where they should be.

This is getting more interesting ....

[Anonymous Coward]

http://www.networkworld.com/community/blog/ciscogate

Re:Maybe raising taxes isn't the only solution.

[StormyWeather]

It's pretty decent if you believe what the country is reporting, and understand not all countries use the same figures to get to the conclusions. A good example is the infant mortality rate. The U.S. ranks very high on the infant mortality rate, but the reason is that many countries don't count an infant as being a viable human for a certain time frame after birth, while we count every baby with a heartbeat. We used to spend the most according to that chart, but with the recession we have cut back as a country. The point is still valid in my mind. Why don't we get MORE out of the money we are spending? Hell I don't see Finland on that chart at all and they beat the heck out of us in education. Spending as a percentage of GDP is a silly chart. A third would country can spend half their GDP on education, and still not spend 1/100th of the us per student, not only that those countries tend to like to report stuff that is grossly inaccurate.

Re:Maybe raising taxes isn't the only solution.

[HiThere]

I'll agree that support of learning by the family is significant. Not *quite* essential, given an optimal for learning school environment, but even then significant. (And no school in the country, in the world as far as I know, offers an optimal for learning environment. It requires 1-3 teachers/child, e.g. [and not even always the same 1-3 teachers.])

OTOH, my wife teaches music and art in her studio, and she reports that children whose mothers don't go to work tend to have children that are about twice as easy to teach. These parents are obviously committed to their children's learning, or they wouldn't enroll with my wife, but so are the parents that work. The probable conclusion that I draw from this is that working full-time strongly interfers with doing a good job as a parent.

Again, there was I study that I read reporting on class size vs. learning in highschool. That reported a sharp decline in learning when the class size exceeded 18. There was a smooth curve drawn, but I don't know how well it actually fit the data. Still, there was a slow decline in learning rate from class size of 15 approaching 18, 18 was the knee of the curve, and there was a fairly rapid rise beyond 18. One needs to wonder what other effects were present, e.g., what other factors do students that good to schools with a small class size have in common. Still, it's not a totally unreasonable conclusion, given the difficulty that high school teachers have in controlling their classes (any effort spent in controlling the class obviously takes away from effort that could be spent instructing), and also attending to each students unique needs can be time consuming. Large classes prohibit that.

That said, the "teach to the test" is guaranteed to produce students inferior in every way except in test taking. And it's not clear that they'll be much good even in taking different kinds of tests. It's not clearly an entirely wasted effort. Twice a year would be reasonable. Say once at the start of the school year, and once at the end. More frequently is a waste of time, resources, effort, attention, learning, money, etc.

Re:Maybe raising taxes isn't the only solution.

[erp_consultant]

Well, poverty is a very complex problem. Yes, it's partly due to inequality but it's also partly due to lack of drive or willpower. I can't think of a country where more opportunity exists than in America. In many countries poverty is due mainly to lack of opportunity. If you were not born into a wealthy family you have little or no chance of every escaping poverty. Not so in America. There are many, many people that have risen from poverty to become wealthy beyond their wildest dreams. More still that have risen from poverty to enjoy a good middle class standard of living.

Some people, even if you hand them opportunity on a silver platter, will not take it. Maybe they lack the intellectual capacity to see opportunities when they arise. Maybe they make bad choices. Maybe they just don't give a shit. For some people, maybe they are happy with their lot in life and don't worry about not having a lot of material things.

As far as "fighting poverty" goes, how do you fight it if nobody really knows how to cure it? Clearly throwing more money at the problem has not worked. I'm not suggesting that we abandon the poor. Society has an obligation to take care of people that can't take care of themselves. The key word there is "can't". I don't believe that society has any obligation to take care of people that WON'T take care of themselves. If they have problems with drugs or alcohol, fine, let's get them some help. But there will always be a small portion of the population that is perfectly able to work and support themselves but have decided, for whatever reason, that they just don't want to. For those I offer no sympathy.

Cisco is a Partner Led company

[badford]

I did not read the article. Just want to state that Cisco typically does not bid directly on projects like this.

A 'partner' (Service Provider like AT&T or Century Link. An integrator like Northrop Grumman or WWT)

Would bid on this. They get (Managed Solutions Partner) Discounts that they would bake into the RFP response.

Some of these discounts are as high as 65-70%, depending on the product, competitive landscape and so-on.

I would take this price comparison with a big grain of salt. There is more here than meets the eye.

Stimulus!

[timothy]

So you're saying you'd rather not stimulate the economy with 100 million more dollars? Why do you hate America? :)

Businesses waste money sometimes, but they can more easily go out of business if they screw up enough. University funding, when it comes from the state / State, may or may not be at the optimal level for educational outcomes as seen from any particular perspective, but it isn't based on a strong feedback between money spent and outcomes. So when I see people complain that California schools "can't afford" a cut to higher education budgets in that state (these ads follow me around for some reason, though I don't live in California ;)), it seems like maybe there's some wiggle room wrt what they *can* afford, if Cisco thought this was a big that might be accepted.

Uncle Miltie had it years ago: http://www.youtube.com/watch?v=5RDMdc5r5z8

Exactly!

[hesaigo999ca]

Here is a great way of showing if there is any price fixing, or maybe overpricing.... we see here overpricing on cisco's part is flagrant, and should anyone have mentioned we absolutely need cisco equipment, would have cost way more then it should to rejuvenate their network. This is evident in all government construction as well....but we never get to see the bids, only the winning bid....

Re:Maybe raising taxes isn't the only solution.

[Stuarticus]

What we need is an expert assessor like yourself to separate the deserving poor from the undeserving. I'm sure your great insight would solve global poverty instantly.

Re:Maybe raising taxes isn't the only solution.

[erp_consultant]

And what would you have us do? Do you think we should continue down the same path? The social welfare state, although well intended, has clearly not eliminated poverty in America. It hasn't even reduced it in any meaningful way. I'm not suggesting we get rid of it I'm suggesting we have a discussion about how to improve it. A meaningful discussion. One without, you know, snide remarks like the one below.

"I'm sure your great insight would solve global poverty instantly." - Global poverty is a much different issue. I have visited third world countries. Have you? I have seen grinding poverty up close and personal. It's enough to bring tears to your eyes. Trust me, it's nothing like people here living in "assisted housing". Their challenges are much more basic - clean drinking water, proper sanitation, disease, lack of access to education. These are issues that we thankfully don't have to face in America. We are fortunate. We have lots of drinking water. We produce more food than we need. Children have access to public education.

Nobody is going to solve global poverty instantly - even an "expert assessor" like me ;-)

I think that the Gates Foundation is making great strides though. He is looking at charitable giving in a much different way, taking a more active role in where his money goes and how it is spent. He is expecting to see progress...and I believe he is. He realizes the magnitude of the problem and sees success more in making targeted gains on specific problems. It's a start.

Re:Maybe raising taxes isn't the only solution.

[Stuarticus]

The problem is that everyone thinks that the budget shouldn't include their own personal pet hate. This leads to an ever decreasing spiral and more hoops for those in need to jump through until people who actually need help are unable to get it.

It's interesting you mention the Gates foundation, because there are a lot of questions around about it.... http://techrights.org/wiki/index.php/Gates_Foundation_Critique