It was five years ago, March 2009, when Cisco formally announced “Project California,” its (possibly intentionally) worst-kept secret, as Cisco Unified Computing System. At the time, I was working at Hewlett Packard, and our collective feelings as we realized that Cisco really did intend to challenge us in the server market were a mixed bag. Some of us were amused at their presumption, others were concerned that there might be something there, since we had odd bits and pieces of intelligence about the former Nuova, the Cisco spin-out/spin-in that developed UCS. Most of us were convinced that they would have trouble running a server business at margins we knew would be substantially lower than their margins in their core switch business. Sitting on top of our shiny, still relatively new HP c-Class BladeSystem, which had overtaken IBM’s BladeCenter as the leading blade product, we were collectively unconcerned, as well as puzzled about Cisco’s decision to upset a nice stable arrangement where IBM, HP and Dell sold possibly a Billion dollars’ worth of Cisco gear between them.
Five years later, HP is still number one in blade server units and revenue, but Cisco appears to be now number two in blades, and closing in on number three world-wide in server sales as well. The numbers are impressive:
· 32,000 net new customers in five years, with 14,000 repeat customers
· Claimed $2 Billion+ annual run-rate
· Order growth rate claimed in “mid-30s” range, probably about three times the growth rate of any competing product line.