Dell Enterprise President: Cisco ACI Is 'Vaporware'; Decries High Price, Lock-In

Dell Chief Commercial Officer and President of Enterprise Solutions Marius Haas blasted Cisco's ACI software-defined networking offering as "marketing vaporware" and decried the high price and lock-in he says have characterized Cisco's business model.

"They went from UCS, and now they're trying to move up the stack with ACI," said Haas. "There's not a lot there except a lot of marketing vaporware."

Cisco refers to ACI as an "open" software-defined networking solution. But it is built on the Cisco Application Policy Infrastructure controller, and requires what Haas called high-priced Cisco Nexus 9000 Series switches.

[Related: Cisco's Chambers: We're Pulling Away From Competitors In SDN]

Keeping customers locked into proprietary hardware is part of the Cisco strategy Dell is attacking fiercely. Haas says Dell's commitment to open networking and software-defined ecosystems undermines Cisco's hold on the market by appealing to customers' desire for flexibility and value.

"It disrupts their model of a three- to five-year cycle, where [they] are going to generate a new product line and a new portfolio, where a customer is going to have to upgrade, and that's been my historical business model, and I'm doing it at 60 to 80 points of margin," Haas said. "Customers don't want to pay for that anymore, they don't want the lock-in and they don't want to pay for that."

Several solution providers told CRN recently that Dell is making significant gains versus Cisco.

Scott Winslow, president of Winslow Technology Group of Waltham, Mass., said Dell is making significant progress against the industry's most powerful legacy vendors.

"Cisco is the predominant player, HP's probably the No. 2 player, but I would say that two years ago [Dell] didn't have a great networking solution, but with the acquisition of Force 10, they've made gains, and now they've got some great networking products," Winslow said. "At the end of the day, the portfolio is pretty damn good, and they wrap it up with the 'Do More' program that keeps you really loyal with rebates and incentives."

"Partners are looking for vendors who can be their partner in this transition," Haas said. "But how do they still make good money in doing that? That's where we've been focused, making sure the economics of working with Dell is something that is enticing to them."

At a recent conference, Cisco Chairman and CEO John Chambers criticized Dell for missing important market opportunities, and compared Dell to defunct minicomputer manufacturer Digital Equipment Corp.

Haas made a similar comparison for Cisco.

"You could draw an analogy of who was the biggest networking leader in the industry awhile back," Haas said. "Nortel was one of the biggest players in the space. Well, industry changes, technology changes, business models change. You're not going to be on top forever. The question is: Is Cisco going to be able to keep on adapting, or is the industry going to create a shift that will be disruptive to them? I'm betting that the shift will be coming."

Cisco did not respond to a request for comment on this story.

PUBLISHED JUNE 23, 2015