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Cisco Steps on Server Giants' Toes

http://www.fool.com/investing/value/2009/03/17/cisco-steps-on-server-giants-toes.aspx

Anders Bylund
March 17, 2009

Cisco Systems (Nasdaq: CSCO  ) is never boring. Just when you think you have the networking giant all figured out, it does something completely unexpected. This time, I'm not so sure that's a good thing.

The latest twist on Cisco's story is a "unified computing system" (UCS) that basically puts serious server hardware inside a high-end network switch, with everything tuned to slice virtual machines out of the whole package. Marrying network gear to the computing resources that need it sounds like it makes sense, but Cisco is playing a risky game here.

The product comes with glowing endorsements from industry leaders in almost every corner of the data center: VMware (NYSE: VMW  ) is helping with virtualization, EMC (NYSE: EMC  ) w