12/13/2004 -- Last week, we looked at Cisco’s performance in 2004 and discussed areas in which it can expect to be a strong competitor in 2005. This week, we’ll take a look at some of Cisco’s most glaring weaknesses in the coming year.

For starters, says Joel Conover, a principal analyst for enterprise infrastructure with consultancy Current Analysis Inc., there’s Cisco’s Catalyst 6500 switching platform, which gives it enormous flexibility in terms of catering to a wide variety of customers but which is also off-putting to shops that have limited IT budgets.

“While Cisco can cater to the largest of enterprises with its Supervisor 720 architecture, achieving these levels of performance is simply cost prohibitive,” Conover notes. “Cisco has made some strides in simplifying the deployment of its high-end modules, but provisioning a full-performance system still requires the appropriate supervisor, modules and daughter cards, all of which carry hefty price tags.” The upshot, he says, is that many Catalyst 6500 adopters find that they’ve gotten themselves in over their heads: “Many customers buy into the low end of the Catalyst 6500 with the intent to invest in the platform as their requirements grow, but such upgrades are the minority of 6500 shipments.”

Similarly, Cisco’s vaunted IOS is actually a liability with some customers, Conover points out. “Cisco’s IOS software has become extremely complicated due to the constant addition of new features. As a result, customers must spend additional time and resources training staff to leverage and configure the technologies that the company provides in IOS,” he writes. “The complexity of IOS is a competitive disadvantage, with competitors such as Juniper beginning to attack Cisco’s monolithic architecture on the basis of its reliability and flexibility.”

Elsewhere, says Conover, Cisco still hasn’t taken any definitive steps to merge its PIX firewall or VPN/Security Management Solution with its 3000 series offerings. “As Cisco’s security monitoring and policing tools continue to expand and gain ever more market traction, the need for a unified central command center is greater than ever, but Cisco addresses only a portion of its products in any given management platform,” he points out.

Conover’s prescription? “Cisco needs to address significant competitive weaknesses and lack of integration in its firewall/VPN/IDS portfolio,” he says. “Specifically, while Cisco has done an excellent job of addressing the high end of the market, its mid-market PIX appliances are showing their age.”

In the enterprise telephony space, Conover argues, Cisco is seriously vulnerable, thanks to the cost and complexity of its available offerings. “These sorts of complexities ultimately create the opportunity for competitors to muscle in on telephony first, and potentially data networking down the road,” he notes.

Finally, Cisco still doesn’t have a compelling story in the SME space, thanks to its inability to compete on the basis of price against competitors such as Dell, 3Com and Hewlett-Packard, says Conover. “Channel partners will be still harder pressed to make up for low margins in this market segment,” he concludes. -Stephen Swoyer