This is a summary of the report on “Cisco’s Commitment to Smart+Connected Communities”. For information on how to obtain the entire report, email the author, Tom Kucharvy, at TomK@Beyond-IT-Inc.com
Cisco is on a self-described mission to transform itself from what CEO John Chambers called a networking “plumber” into a trusted architectural adviser and provider of “platforms for innovation”. This requires a fundamental transformation in the company’s value-add, its sales model, the types of services it provides and, perhaps most challenging, in the type of partners the company recruits and in the ways it engages with them.
The company, as discussed in a series of my blogs beginning in May 2010, effectively began this journey by developing a solutions-based approach to promoting its video and other collaboration technologies, virtualization, and borderless networks—all by leveraging its core strength around the network as the underlying platform. It has since extended way beyond horizontal solutions by unveiling initiatives around a growing number of solutions-based “market adjacencies.” These adjacencies, which include healthcare, education, energy, transportation, sports, entertainment and public safety and security, are also being combined into more comprehensive and ambitious efforts such as its Smart+Connected Communities (S+CC) initiative, in which it provides the intelligent, integrated network solutions across multiple adjacencies to help cities drive economic, social and environmental sustainability and efficiently deliver 21st century services.
These efforts will serve as critical proof points of whether the company can indeed extend beyond the maturing and increasingly competitive market for switches and routers to become a globally recognized provider of solutions that improve businesses, societies and Cisco’s own bottom line.
Building the S+CC Value Proposition
Although Cisco has been providing tools for addressing specific, narrowly-defined industry initiatives for the last several years, its effort to pull all of these and other complementary point solutions into a comprehensive network-based, city-wide architectures began in 2008, when real estate developer Gale International selected Cisco as its networking partner in developing the intelligent infrastructure for a totally new city, the Songdo International Business District, which Gale was developing in South Korea.
New Songdo is the most expensive privately financed real estate project in history. It will be a green, LEED-certified community, designed from the ground up to emit one- third of the greenhouse gases of a typical city its size. It will also be one of the world’s first smart cities, with Internet-monitored and controlled traffic, water, power, transportation and public safety. Every wall socket and appliance will be connected to the IP network and every home and office will be able to monitor and orchestrate its own heat, air conditioning, lighting, appliances and energy usage. Each will also have its own Cisco TelePresence videoconferencing system—which Cisco claims will be the “killer portal”—though which all types of urban services (healthcare, education, safety, shopping and so forth) can be accessed.
As ambitious as New Songdo may sound, Gale and Cisco view it only as a starting point. Given the rapid growth in Asian urbanization, the duo plan to use New Songdo as a template from which they will build more than 20 new “instant cities” across Asia. Cisco will also apply the same platform to helping cities of all ages refresh their current infrastructures and enhance and automate the delivery of each individual service (from distance learning and health monitoring through energy management and security services) for which they have a need.
Although Cisco already has many of the infrastructure capabilities required for a platform on which to run and from which to deliver this broad range of services, its history as a box-pusher and plumber has hardly prepared it—much less give it the credibility—to effectively evangelize the vision of a world of vertical services, much less that of the architecture of the city of the future.
It began developing these capabilities gradually beginning with discrete initiatives, as around its Telepresence system and suite of collaboration tools, and then extended these efforts into discrete verticals, such as education and healthcare. As I discussed in a series of blogs in mid-2010 it began this process by:
- Hiring and training salespeople and consultants steeped in these areas and created a five-stage, services-based process for guiding customers through the entire process, from solution ideation through implementation; and
- Created a three-stage, service-led solutions incubation process that used its Internet Business Services Group (IBSG) and Advanced Services (AS) organizations to incubate new markets and create lighthouse accounts for promoting its solutions.
It promotes these solutions in its own demonstration centers and highlights them in high-profile venues such as the 2010 Shanghai World Expo. It even created its own virtual, nonprofit S+CC think tank, the Smart+Connected Communities Institute, to spur joint research and knowledge sharing, foster best practices, explore governance models, create training and education programs and eventually, create certification programs around new models of public-private partnership for achieving economic, environmental and social sustainability.
The Platform Ecosystem
But while Cisco recognizes the need to establish itself as a thought leader and to lead the recruitment, design and implementation phases of early accounts, Cisco is, first and foremost, a partner-centric company. Its goal is to package its learnings from initial lighthouse accounts, train and certify partners to use them and then work with these partners to scale new businesses (see my blog on Cisco’s Value-Added Services Partnering strategy for more details).
Cisco’s first step in creating this partner ecosystem was to create an open, standards-based platform. Its City Cloud Platform provides the network infrastructure, complete with a set of underlying horizontal collaboration and Telepresence services and open APIs on which partners can write and deliver their specialized, vertical applications and services. Its initial recruitment efforts are focused primarily on two broad classes of partners:
- Technology partners, including industry-specific ISVs and system/software providers and providers of complementary horizontal tools such as analytics; and
- Strategy, market development and consulting partners, primarily SIs with particularly strong positions in specific geographies and market niches.
Given the complexity and large number and range of partners required to design, develop and deliver managed services to cities, Cisco will rely even more heavily on partners for S+CC than it does in its other markets. It will, itself, focus primarily on the communications and collaboration infrastructures required to run these communities. This combined with the fact that Cisco does not plan to build vertical software or create large consulting or managed services businesses, will help it minimize conflicts within these inherently complex S+CC ecosystems.
Cisco is certainly making big investments and incurring big risks in its efforts to jumpstart and establish itself as a thought leader around its broad range of Smart+Connected Communities initiatives. But while its risks are very real, they will, in all likelihood, be relatively small. After all, even if Cisco’s “instant city” vision proves to be a bust, many of its component initiatives, as around telepresence, connected maintenance, energy management, clinical collaboration, distance learning and video surveillance, are already coming to fruition and have the potential of emerging into large, sustainable markets.