7/25/2005 -- Last week, Cisco Systems Inc. announced that T-Com -- the fixed network unit of German telecommunications giant Deutsche Telekom -- plans to extend its IP/MPLS network by upgrading to Cisco’s latest generation Cisco IP Service Engine (ISE) interface cards.

T-Com, which currently uses about 200 of Cisco’s 12000 Series routers, says the upgrade will help reduce its operational expenditures by simplifying its network architecture. On top of this, of course, the ISE-equipped 12000 Series routers will provide a platform for the deployment of Cisco’s next-gen IOS XR operating system. Analysts say the win is a boon for Cisco.

“The upgrade further entrenches Cisco’s position in one of the largest next-generation networks in Europe, and it further validates Cisco’s strategy to migrate the installed base of 12000 series routers from the core to the edge of its carrier customers’ networks,” says John Marcus, an analyst with consultancy Current Analysis Inc.

It’s a prestigious win for Cisco. T-Com is one of the largest fixed-network carriers in Europe, says Marcus, with an infrastructure that includes roughly 197,000 kilometers of optical fiber and an IP network based on MPLS technology, transmitting a data volume of around 30,000TB per month.

More than that, however, the win amounts to a major win for Cisco over a major archrival, Marcus writes. “Although Juniper is also a key router supplier to T-Com, Cisco is a longstanding vendor in the German incumbent’s network, which has a large number of Cisco 12000 Series routers now providing functionality in the edge layer,” he notes. “With the announced upgrade, Cisco will deliver the latest generation Cisco ISE interface cards to the existing 12000s. This follows on from close collaboration between Cisco and T-Com to develop new carrier’s carrier functionality for the platform, in order to provide enhanced virtual backbone services for its carrier and large enterprise customers.”

The scale of the deal is breathtaking -- especially for T-Com, which is making an enormous long-term investment in Cisco gear. “[T]he deal indicates a total commitment by T-Com to its installed base of Cisco 12000 Series routers in the edge of the network. For Cisco, the T-Com upgrade gives it a high-visibility showcase for demonstrating the operational expense savings possible through the deployment of its ISE interface cards,” Marcus writes.

T-Com’s decision must have been anything but a slam dunk. To be sure, the company has a significant investment in 12000 Series routers. But the 12000 Series was not originally developed for core IP routing, says Marcus.

“No matter how graceful the solution for adding Cisco’s ISE interface cards, the vendor cannot argue that its platform was designed for edge routing deployments. This reduces the impact of its T-Com upgrade win, providing ammunition for rivals in future competitive bids,” he notes. “[T]his fact makes the upgrade something of a defensive win for Cisco. Capturing T-Com’s demand for edge service routing functionality represents Cisco’s ability to stand its ground and protect its territory, but not necessarily its ability to win against competitors starting from an equal position.” -Stephen Swoyer