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What's the deal with Apple-Cisco deal?

Gregg Keizer | Sept. 3, 2015
Analysts parse vague statement, try to figure out what partnership means for Apple's enterprise strategy.

"Most businesses still have land-line phones, although many have moved from PBX to IP-based phones," said Moorhead, referring to Internet protocol-driven telephony, where calls are routed over the Internet. "More workers are moving around, but they still have two types of phones, a land-line and a mobile. Why not just make one phone, with the mobile phone emulating an IP phone? That's what I think will be part of the deal: The iPhone will emulate the Cisco IP phone at the desk, but when it's disconnected from the network, it works as a normal mobile phone."

Moorhead believed that a dual-use iPhone as he described it would be implemented by software -- "More of an app model," he said -- but because it would require deeper access to iOS than a typical developer or vendor is given by Apple, a partnership was necessary.

Alongside that move, said Moorhead, Cisco's video telephony and conferencing could be deeply integrated with iOS to provide a better experience for companies that rely on Cisco's software and services, including WebEx. And the "fast lane" mentioned by Apple and Cisco may hint at furthering the packet prioritization already supported by the latter's networking hardware.

"In a modern Cisco network today, you can prioritize traffic across the WAN [wide-area network], WLAN [wireless local area network]," added Moorhead. "Maybe the deal will prioritize packets [to and from an iPhone] to bring a better mobility experience, and along the way, reinforce the value of Cisco hardware and networks."

Cisco may see the partnership as a way to gain what Moorhead called "an unfair advantage" over networking rivals when connecting to iOS devices, which are pervasive in enterprises, especially the iPhone. The devices are often owned by workers themselves rather than bought by the company for employees.

If the iPhone works better on a Cisco-based network, Moorhead speculated, the San Jose, Calif. company could use that as a potent sales weapon when going head-to-head with competitors like Juniper Networks. Meanwhile, Apple could pitch its iPhone and iPad to enterprises as not only a replacement for land-line telephones and expensive video conferencing gear, but preferred throughout by virtue of the new technical benefits.

Apple would like to push the iPad to enterprises as a way to get the tablet back on a growth line. Dawson, for example, saw the partnership as a way for Apple to sell more iPads, perhaps the rumored larger-sized model most expect to see this year.

"This could make it more attractive for businesses to buy iOS devices, but Cisco gets more out of this at this point," Dawson concluded, given Cisco's association with the world's leading technology brand. Apple, by comparison, continues what Dawson dubbed its "salami tactics" as it approaches enterprises. "A little bit here, a little bit there," said Dawson, referring to the IBM and Cisco partnerships, and the believed-imminent larger iPad.


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