Friday July 13, 2018

Amazon Web Services to Enter Networking Equipment Market

Cisco shares were down 5% and lost $11 billion in market capitalization after a report circulated that Amazon Web Services is primed to enter the lucrative network equipment market. It is rumored that Amazon will sell their white-box switches for 70% - 80% less than comparable Cisco solutions. These white-box devices will feature built-in connections to Amazon Web Services. The software running on these devices is open-source and the hardware is unbranded to lower the cost. Another upside is that open-source software allows for more customization than proprietary vendor software.

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The networking devices will consist of open-source software and unbranded hardware known as "white-box" switches and come with built-in connections to AWS cloud services, such as servers and storage, the Information said. Amazon Web Services could price its white-box switches 70-80 percent less than comparable switches from networking giant Cisco, the report said, citing one of the people with direct knowledge of the unit’s plan.