...and sufficient memory to store data and process the data. It also needs more expensive battery technology to ensure the device can handle all the processing. But in a virtualised world, those applications could be accessed through the network; and data, such as video, music, and pictures, could also be accessed via the network.
Of course the problem with doing this today is that the network is not fast enough. But as carriers roll out 4G wireless broadband networks, this idea of virtualisation could become a reality. It is already starting to become a reality on the wired network. Many people today already enjoy media that is streamed from services such as Hulu.com to their PCs at home.
Cisco believes it can greatly reduce the cost of delivering these kinds of services to consumers. In fact, the company says it can reduce current datacentre costs by about 20 percent and reduce complexity in the datacentre by about 30 percent.
"Almost every customer we talk to is looking to save money and increase business agility," said Rob Lloyd, senior vice president of Cisco Worldwide Operations. "And almost all of them have been looking at virtualisation. There has already been a lot of progress, but we think we've solved some of the big questions."
Datacentre virtualisation is by no means a new concept. Cisco's competitors HP and IBM have already been selling solutions to help companies do this; and many others are also getting into the market.
Virtualisation one-stop shop
But Cisco believes its solution — which includes new hardware, such as blade servers — can be packaged together with hardware and software from partners to provide companies of all sizes a one-stop shop for all their virtualisation needs.
"It's like offering to sell someone a kit to build a car or actually selling them a car," David Lawler, Cisco's vice president of platform product marketing, said in a phone interview. "Anyone could build a car from a kit. But we sell the car right off the lot."
While Cisco says that it will help its customers become more efficient and consumers may eventually benefit from access to new applications on cheaper devices, Cisco also benefits from the strategy. For one, Cisco will benefit from selling its datacentre products to companies and service providers, which offer these virtualised services. But it also benefits because putting more content in the 'cloud' will also increase traffic on the network, which means Cisco will sell more of its IP routers and switches.
The company has taken a similar approach in other markets. For example, in the VoIP market, Cisco built its own telephone products that turned voice communication into an IP service. Now, Cisco is the number-one maker of corporate VoIP equipment. And when companies add voice to their network, they generally need to upgrade their corporate IP network, which generates even more business for the company.
The same is also true of the telepresence products and services. Cisco put together the telepresence solution to help its customers improve collaboration, but putting video on an IP network also generates more video traffic on the network, which ultimately translates into more business for the company's core products.
"Cisco has done this already," said Kerravala. "They have done this in VoIP and telepresence, and they've proven that they can push the market in their direction. But a lot of their success in terms of delivering true network-based services will happen in concert with other things, like the digitisation of content and the build-out of new wireless networks."
