Cisco and Microsoft Interoperability Efforts: One Year Later

REDMOND, Wash. — Sept. 3, 2008 — Just over a year ago today, Microsoft and Cisco announced plans to deepen their technological collaboration to meet customer demand for improved interoperability between their respective software and networking products.

Kathy Hill, senior vice president of Access and Networking Services at Cisco

The initiative was jointly launched by Microsoft CEO Steve Ballmer and Cisco chairman and CEO John Chambers, and is currently being spearheaded operationally by Bob Muglia, senior vice president of the Server and Tools Business at Microsoft, and Kathy Hill, senior vice president of Access and Networking Services at Cisco.

Following the one-year anniversary of the announcement, PressPass spoke with Muglia and Hill to get a progress report on the collaboration, how customers are benefiting and where the relationship goes from here.

Q: When you originally embarked on this collaboration a year ago, what was your objective?

Hill: A year ago we announced a commitment to working together so that our customers can be successful regardless of whose solutions they choose. Our approach is based on a commitment that where we do compete, we will continue to address our customers’ needs for interoperability between our respective products.

Muglia: Yes, our customers were very clear in voicing their desire for greater interoperability between their Cisco networking gear and Microsoft software. Cisco and Microsoft have participated in many areas of customer-driven interoperability for more than a decade. In fact, prior to the 2007 announcement we accelerated many areas of collaboration to better address our customers’ needs – from IT architecture to security to management scenarios. Last year, we realized we needed to do a better job communicating to our customers about those areas of collaboration and how committed the companies are to providing highly interoperable solutions.

Q: What have been the chief accomplishments of Microsoft and Cisco’s interoperability work over the past year?

Muglia: Last year, we outlined the work we were doing across seven areas: IT architecture, security, management, wireless and mobile, unified communications, connected entertainment and small and medium-sized businesses (SMB).

While we continue to make progress in each of these areas, the three that stand out over the past year are network optimization, IT architecture and connected entertainment.

A great example of this progress is Cisco’s work in optimizing customer networks for efficient deployment of Microsoft software. This Cisco network optimization for Microsoft applications has helped our customers deploy SharePoint, Windows Vista and Windows Server 2008 out into branch offices and over their wide area networks (WANs). It’s an arena in which we’ve been able to work harmoniously together, generating some nice synergies between our respective technologies for the benefit of our mutual customers.

I’d also highlight our joint efforts embedding Windows Server 2008 on Cisco’s Wide-Area Appliance Service (WAAS) branch office solution (called “Windows Server on WAAS”), which gives our customers an integrated appliance for their branch offices. It provides customers with a single solution that delivers the core IT services of Windows Server 2008 at the branch location, improving efficiency and responsiveness, while relieving the network for quick and reliable application delivery.

Bob Muglia, senior vice president of the Server and Tools Business at Microsoft

Finally, I think this joint commitment has allowed us to be very upfront and open with our customers about our unified communications offerings, spelling out how we will compete and how our software will work with Cisco products.

Hill: It has been a productive year, as Bob explained. We’ve also made progress in a few other areas.

Cisco recently decided to join Microsoft and other vendors as a member of TSANet, an industry organization that is trying to make it easier for companies to manage multi-vendor IT contracts. I’d put this in a similar category to our ongoing work with the Interop Vendor Alliance, a community of software and hardware vendors dedicated to improving the interoperability of their products with Microsoft systems.

The other result we’re proud of is our continued momentum with Internet TV. In January, we launched the Linksys Media Extender, which works in conjunction with Windows Vista Media Center to deliver streamed content from the PC to the TV. Meanwhile, we recently surpassed the million-unit mark for shipments of Cisco IP set-top boxes supporting the Microsoft Mediaroom IPTV platform. That’s powerful proof of the business case for the work we’ve done together.

Besides these developments, I’d really underscore the importance of Windows on WAAS, which is a great example of the kind of mutually-beneficial initiative this collaboration has made possible. It’s a scenario in which the two companies joined forces to be better together. Customers can use two solutions that actually enhance each other. We are truly going to market hand-in-hand, which our customers have really appreciated.

Q: What other benefits have Cisco and Microsoft’s mutual customers seen?

Muglia: By providing our customers with a clear picture of where we’re working together, now and into the future, we’re helping them make informed investment decisions with reduced risk and as much foresight as possible. It is our goal to make sure our customers know where we stand so they have the peace of mind that they are not locked into a particular piece of technology as their needs evolve. This clear picture allows them to evaluate the technology that represents the best fit for their specific needs, based solely on its merits, without needing to juggle other considerations.

I think we’ve been able to help ensure that our customers can deploy the very latest Microsoft software as easily as possible and that it will work with the Cisco networking solutions. To provide more information about this effort, we worked with Cisco to produce a white paper detailing how Cisco’s network optimization can help customers deploy Microsoft Office SharePoint Server and Windows Vista more efficiently with lower risk and at a reduced cost.

Similarly, Windows running on Cisco WAAS enables customers to roll out Windows Server 2008 features in their branch offices with reduced administration and management overhead and enhanced control over Windows services across their branch network.

Although Microsoft and Cisco will continue to compete for customers in the unified communications arena, both of our companies share a joint commitment to ensure the appropriate level of interoperability between our respective products for the benefit of our customers and partners. We will keep working together to communicate clearly with our customers, partners and sales forces as to how we are competing and cooperating.

Hill: The work we’ve done has been well received by our joint customers, which of course represents a significant number of organizations. The vast majority of Global 2000 companies are Cisco-Microsoft shops and we estimated that 98 percent of our mutual large company customers use both Cisco and Microsoft products.

Aside from the general positive feedback, Windows on WAAS really highlights how the fruits of our cooperation are squarely addressing our customers’ needs. Branch offices are proliferating, to the extent that 90 percent of employees now work outside of their organizations’ headquarters. Satellite offices also represent an increasingly strategic component of any enterprise because they are closer to customers in the field. They are becoming major consumers of IT resources and an increasingly important consideration for IT and business decision-makers.

Beyond direct customer benefits, this collaboration is creating opportunities for our industry partners and systems integrators, which translates into additional benefits for our customers. The interoperability and integration road map helps our services partners develop better, more customer-focused offerings, expediting their time to market and deployment. To these partners, our collaboration is making all the difference and delivering some nice top-line benefits to their business.

Q: How have you taken account of key industry trends and developments since its announcement last August?

Hill: Addressing emerging customer needs is what this collaboration is all about. We put our heads together to get out in front of our customers to anticipate their needs and address the real-life technology issues they face. For example, many of our customers are considering shifting from running some of their IT services in-house to having them hosted remotely. Cisco and Microsoft are working together to identify how this change impacts the network and computing resources to ensure that our customers’ requirements are met.

Muglia: One of the biggest trends we’ve seen has been in online services. To address this we recently brought together the key people responsible for the online services strategies in both companies to share our respective views and brainstorm how we might best combine our efforts for the benefit of customers and to accelerate take-up of this exciting new paradigm. Our work is ongoing and we are in touch regularly, so we’re always on the lookout for fresh ways in which we can deliver value and address the emerging needs of our customers.

Q: How have Cisco and Microsoft been able to juggle this cooperation with their ongoing competition in product arenas, such as unified communications?

Hill: It is fair to say that both companies are aggressive growth engines, so there’s going to be overlap in certain markets where we are looking to help our mutual customers. In markets where we intersect like the connected home, unified communications and security, we’ve made a conscious decision to take extra steps to improve the interoperability of our products for the benefit of customers. And even though unified communications is clearly an area of competition, it is also one of the areas into which we’ve directed much of our collaborative energy in the spirit of giving our customers the choice and flexibility they’ve told us matters to them.

Muglia: I’d agree. We think competition is great for customers because in new and fast-growing markets like unified communications it gives them choice between alternative technology solutions that meet their needs. And in the long run, competition will help accelerate the market for unified communications by spurring new technologies and driving down costs.

At the same time, we’ve got people on both Cisco and Microsoft internal teams tasked with advancing UC interoperability alongside people dedicated to other areas of interoperability, because this is what our customers have expressly asked for.

Q: Looking ahead, how will the collaboration evolve and develop?

Hill: For the future, our customers can count on the continued strength of our mutual commitment, and they should certainly look for us to continue to expand our portfolio of joint products. We are working closely with customers like Monsanto and Arthur J Gallagher & Co. and will continue to gain feedback from them on our progress.

At the end of the day, we don’t want to lose sight of the fact that Microsoft is the biggest producer of software and we’re the biggest maker of networking technology. Computing software and the network must work together to drive business innovation and deliver a more compelling user experience. Through our work with Microsoft we’re working together to push the boundaries of what’s possible with networking and software innovation coming together.

Muglia: Looking ahead, we’ll continue to focus on datacenter architecture, security, IT management and online services-related scenarios. These issues still represent significant areas of interest to our customers, and areas where our collaboration can continue to advance work happening in the industry as well.

We want to assure our customers that this is an initiative to which both companies attach the utmost importance. The fact that we have executive-level buy-in right up to the boardroom as evidenced by the joint launch of the initiative by both CEOs last year is a measure of our collective commitment to making it work on behalf of our customers.

In addition, Kathy and I get together quarterly, and often check in even more regularly than that, as well as bringing in the leads of the individual areas of collaboration at least once a quarter. We have people on the Microsoft side for whom the relationship with Cisco constitutes a significant part of what they do.

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