No plans for Cisco to set up R&D facility in NZ

The rumour is false: networking company Cisco has no plans to set up an R&D facility in this country.

The rumour is false: networking company Cisco has no plans to set up an R&D facility in this country.

The company looks continuously around the world for new R&D facilities, but there are no specific plans to set one up in New Zealand, says Alan Marcus, Cisco's director of solutions architecture for customer advocacy.

The vague mention of the possibility got some media into a state of excitement. After New Zealand's loss of the proposed Motorola R&D facility and the well publicised success of Allied Telesyn Research in Christchurch, journalists and commentators are alert for any sniff of a move here by big US technology companies.

"There is nothing specific along those lines at present; nothing that would be set up here with Cisco's brand-name on it," Marcus says. He notes, however, that Cisco's Network Academies programme, which advises universities and some schools on appropriate curriculum content for instilling knowledge of networking technology, is running here with the University of Auckland and schools on the East Cape.

"We [also] work closely with local organisations," like Logical Networks, its partner in the development of a voice-over-IP network for the New Zealand government's social agencies.

Voice over IP for large organisations is still at the beginning of its growth phase, says Cisco’s enterprise voice and video unit business development manager David Tucker. From Cisco’s point of view, he says, this is owing to staged development of pieces of the product set.

“Our call manager software came out two years ago, and that enabled us to scale. Before that, we were only deploying to small and medium-sized companies.”

But ultimately, VoIP will prove an important commercial tool, “allowing a company to retain customers better, as well as attract them,” says Marcus. “Clicks on a website mean nothing”. When the customer can speak to a company representative at the same time as navigating the website, there is the potential for a higher level of service and hence customer retention.

Within a company, voice over IP will bring “rapid integration” of information channels among employees, assisting in storage and management of the organisation’s accumulated knowledge, Marcus says. “Combined information is greater than the sum of its parts.”

In theory, the same effect could be achieved by separate phone and digital systems, he acknowledges, but at the cost of far greater complexity.

The near future will see more applications, such as interactive voice response and call-centre management, designed specifically for VoIP systems, and this will extend their appeal. Since the system is based on a well-established standard, “you won’t have to worry about whether a new application will fit with all your other applications.”

An important applications focus for the future – certainly within Cisco – will be delivery of training for employees via voice and video, he says.

The end-points of the technology – the IP-capable phones – could become commoditised in less than two years, Marcus acknowledges, “but the key is building the infrastructure. That’s where we focus, and that’s our differentiator.”

VoIP is still in its “early adopter” phase, he says. “It’s being adopted by those who can see a competitive advantage in it; others might decide they have other priorities,” with more visible benefits to the business, and defer implementation. “I think [VoIP implementation] will grow rapidly," Marcus says. “We’re seeing growth of 50-60% quarter on quarter now. But that’s starting from very small numbers,” he admits.

The biggest snag to advance of voice-over-IP will be the standard of service expected from the telecommunications provider over its data circuits, says Marcus.

“You [the user organisation] will have to have a greater understanding of how your carrier provides service,” so reliability and quality standards can be enforced. Most data traffic is not mission critical to a business; “it’s bulk file transfer and that kind of activity,” which WAN dropouts will not seriously affect. “Voice is highly mission-critical.”

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