Friday, October 13th, 2006
Cost per port: Cisco vs. Foundry
While preparing two proposals for a customer, Los Angeles-based AM6 Networks (a nationwide leader in carrier colocation and IP transport), I discovered an interesting cost-per-port comparison. This customer was looking for a solution for a large number (over 2,000) of Gigabit copper ports for Layer 2 switching. He didn’t care about the manufacturer; just reliability. Since we sit on perhaps the largest Foundry inventory in the world, an obvious consideration was Foundry. The only other viable option was Cisco Systems, since the number of ports needed was exceptionally high, requiring several modular chassis. We like to stick to Cisco and Foundry because, in our experience, they are the two most reliable solutions.
Anyway, after all calculations were done, the Cisco solution came out to $154.45 per copper Gig port while the Foundry solution chimed in at $156.52 per port.
This is a great illustration of the market identically valuing two industry leaders. There is no more accurate gauge of a commodity’s value than a broad secondary market (such as ours), and the fact that the originally less expensive Foundry option has effectively made up some ground speaks for the product’s robustness.
Does this mean that every comparable Foundy and Cisco product are priced the same? No, as fluctuations in supply and demand for each product are very dynamic. But at this time, for this class of product, Cisco and Foundry are very similar.