Cisco pulls the plug on key WAN switch

Cisco Systems has quietly killed its prime offering for the core of enterprise and service provider WANs and has delayed delivery of another WAN switch by about a year.

The developments raise questions about Cisco's strategy for next-generation WAN switching and could cost the company business. Cisco users who were depending on these products will now have to put their plans on hold, opt for different Cisco gear, wait for the delayed products or choose another vendor's switch.

Cisco has halted development of the TGX 8750, an IP and ATM switch for service provider and enterprise WAN backbones. The TGX 8750 was announced at the ATM Year 98 show last June.

The switch was supposed to go into field trials last year and ship this year. Cisco will now offer its MGX 8850, which is currently positioned as a service provider edge switch, for the WAN core, says Don Proctor, director of marketing for Cisco's Multiservice Switching business unit.

Cisco has also delayed shipment of the IGX 8450, a WAN switch that also combines IP and ATM switching for enterprise data, voice and video integration.

The IGX 8450 was supposed to ship in the fourth quarter of 1998 but won't be available until later this year, Proctor says.

Analysts say Cisco could forfeit WAN business to rivals Ascend and Newbridge Networks, as well as to the high-speed router start-ups.

"Wow," says Scott Heritage of investment firm Warburg Dillon Read in New York when told of the fate of the TGX 8750. "That's not a good sign. The product looked very promising on the drawing board, and I was quite optimistic about it. Obviously, they've been having problems."

"Killing a product like that is significant because that whole announcement as I recall [positioned Cisco] far and away ahead of Ascend," says Rosemary Cochran of market researcher Vertical Systems Group.

"Very interesting," says Joe Skorupa of consultancy Ryan, Hankin, Kent in San Francisco. "I'm not surprised about the 8750. We never thought it was a serious player at the core."

The TGX 8750 was a 20Gbit/sec optical core switch intended to deliver broadband IP and ATM services using Cisco's Tag Switching and the Internet Engineering Task Force's Multiprotocol Label Switching technologies.

Cisco designed the TGX 8750 to let users scale routing to terabit speeds and to bring OC-48c switching to the core "at a price that leads the industry," according to a Cisco press release - $60,000 per OC-48c switch and $US45,000 for channelised OC-48.

Proctor says Cisco killed the switch because the company couldn't build the product to come in at those promised prices.

"It proved very difficult to produce one switch that would meet the enterprise customer's unique needs and the service provider's unique needs at the price they expect," Proctor says.

He adds that Cisco's MGX 8850 has more than enough capacity, density and features to fulfill both the core and network edge roles in service provider and enterprise networks.

Cisco delayed the IGX 8450 because it wants to add voice and virtual trunking capabilities to the switch. The IGX 8450 is a 3.2Gbit/sec IP and ATM switch that connects LANs, legacy data, PBXs and video codecs across private WANs.

The delay will not likely impact IGX user Fleet Technology Solutions of Albany, N.Y., the IT division of banking giant Fleet Financial Group in Boston.

"We've gone through several reorganisations which have realigned certain resources as well," says Thomas Ryan, assistant vice president at Fleet Technology Solutions. "We've postponed the integration to a broadband core."

Ryan says he expects to resume that integration and receive shipment of the IGX 8450 in six months.

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