Cisco: Wireless networks everywhere

In his keynote address Monday at Comdex Fall 2001 here, Chambers touted his vision of the "mobile office" as a way for companies to increase worker productivity and save money amid an economic downturn.

Meta Group says the Cisco Systems and IBM announcement to provide customers such as hotels and convention centers with high-speed Internet access and services should be reassuring to those in hospitality industries. see commentary

"I can run our company from anyplace in the world with the right connection," Chambers said. "The implications are huge...You have to think about revolutionary movements in productivity. Unless you change your productivity, what happens to your profits?"

Chambers, who considers wireless networking technology one of Cisco's high-growth markets, said businesses that explore wireless networking options could create new sources of revenue for the company.

Considered a bellwether for New Economy stocks, Cisco last week gave Wall Street some good news as it met revenue expectations for the first quarter. Financial analysts expect Cisco will continue to grow, despite the many challenges in the networking equipment industry and the overall economic downturn.

As previously reported by CNET News.com, Cisco on Monday announced that Fairmont Hotels & Resorts will use Cisco technology to install wireless networks in its hotels, so people with laptop computers can surf the Web at any location in the hotel.

Cisco previously signed deals with airports, such as John F. Kennedy International and LaGuardia Airport in New York, and at Starbucks cafes. Cisco also plans to partner with airlines and railway lines, allowing people to connect to the Web and corporate networks during commute times.

"It's your ability to provide this first as a competitive advantage," Chambers said. "It keeps (customers) coming back."

In a demonstration, Chambers showed the audience how a coffee shop could incorporate Net access into its business. Customers enjoying a cup of coffee could access the Web and their corporate networks. Through Cisco software, customers could also make phone calls over an Internet network. Looking ahead, computers installed in cars would allow drivers to wirelessly connect to the Web and order a latte while on their way to work.

As he's done in the past, Chambers also touted his vision of e-learning, establishing online training classes for company employees. He also trumpeted the notion of "convergence," where voice and data networks reside on the same Net connection.

"It's not just about e-commerce or e-learning. I'm talking about across an entire company--cross-functional productivity within each department down to the individual desktop," he said. "With this type of leverage, you can be ahead of the competition, and (it) allows you to get a huge competitive advantage."

Cisco and other networking companies have touted combined voice and data networks as easier to manage and cheaper for companies in the long run. Businesses need to turn to the Internet or else get left behind, Chambers said. And that includes finding ways to use the Internet to connect and work with other companies, trading partners, suppliers and customers.

"You need a wave of applications across companies and down to the individual," Chambers said. "Understand that it is about the networked virtual corporation in the future--where you break away from your peers or you get left behind."

Making it work
During his speech, Chambers offered advice on how companies can survive the current economic downturn. Not only do companies need to react quickly to changing market conditions, but businesses also need a strong brand, a good company culture and, most of all, talented workers.

Businesses can win or lose market share during market transitions, Chambers said.

"It's how you handle the tough ones that will determine your future. It will be the fast companies who can establish strong cultures and attract talent that will win."

Chambers said his company has practiced what he's preached and has reaped the benefits. Although Cisco has been hit hard by the economic slowdown, the company still has $19 billion in cash, he said. And in the past few years, Cisco has increased its market capitalization while rivals such as Nortel Networks and Lucent Technologies have struggled, he said.

"It's profits, cash flow and productivity," he said. "It's back to basics."