The moves come as Cisco reorganizes its development council along more traditional lines (enterprise/commercial, service provider, consumer) and largely eliminates the high-level software group that contained the WebEx products. Cisco is shifting its original everything-hosted strategy to a hybrid-cloud model in our view, which is smart given that’s what enterprises want. The question is whether Cisco wants to be the public part of the hybrid cloud or wants to empower service providers to take that role.

The comments made by Cisco’s CTO suggest that Cisco doesn’t want to be an infrastructure-as-a-service provider but isn’t ruling out platform-as-a-service and certainly not SaaS. Cisco also indicated it was ready to meet the challenge of Google Voice and Google Wave in Unified Communication, which at least shows that Google knows that Wave and Voice are UC challenges. We wonder if Cisco might not get too diverted in a battle with Google; it would be better to simply adapt Cisco UC to work inside Wave and to integrate it with Voice using APIs.

The plan is aimed at the RBOCs’ success with smartphones in promoting their own data plans for wireless, creating a useful bundle for consumers. RBOCs are also expected to launch femtocell-based services that would directly integrate wireless and wireline. Comcast says it will follow up with similar services in other Clearwire WiMax cities.

The new offering is surely a version of a unified communications product hosted on the Internet and it competes with nearly all of the telco advanced voice features. It also seems to signal Google’s entry into more traditional services. What the business model for this will be is very hard to say, but the offering certainly puts pressure on telcos to come up with a better (which is to say ANY) service-layer strategy.

Any company, to be successful, has to make its customers successful. There are a lot of paths toward doing that; some rely on innovation and others on integration or being a cost leader. Any company can pick one, but that’s the rub. You can’t pick none, or pick them all. Nortel never had a strategy, it only had a set of tactics to address this or that silo. At a time when “convergence” is the byword of the market Nortel didn’t see its market as being converged, as having a single set of needs and as driven by a single set of conditions. It was, and so they missed the boat.

Cisco or Alcatel-Lucent, both cited by some as examples of what should have happened at Nortel, aren’t out of the woods yet either. The world of carrier and enterprise networking changed forever in 2008/2009 and the remaining players have yet to be tested against the new conditions. Good things, and bad things, are still to come.

Another interesting thing about the deal is that there are some similarities between the NYSE application and the “intra-cloud” networking associated with public, private, and especially hybrid cloud computing. While there is no virtualization in these data centers because of the unanimity of applications, the exchanges have an enormous amount of “federated” traffic from servers owned by others but sited locally to the exchange.

The requirements for this sort of application in the stock exchange world may be more stringent than those of a typical enterprise, but the issues of controlling latency and above all the jitter associated with it are exactly the same issues enterprises are worrying over in private and hybrid cloud applications. Whether Juniper will be able to exploit the exchange win in the broader cloud market is now the critical question.

With 4G deployment there is a need to manage total first-cost and at the same time give users a reasonable experience. Femtocells in each 4G home would give users an in-home experience with 4G as a baseline even if their own home area wasn’t yet covered by 4G cells, or was covered sparsely. If we see more with femtocells in 2009, we’ll also have a chance to see how carriers propose to price femtocell airtime: Will they discount it or make it free given that their network isn’t really being used? That will tell us a lot about whether femtocells will be a means of encouraging high-bit-rate applications at home where traffic won’t hurt the provider network, or whether providers will try to use femtocells only to get a better ROI by reducing the demand for true 4G cells.

Industry data shows that almost three of every four TV viewers will stay with their incumbent operator unless there’s some exciting incentive to switch. The summer is also a good time for promoting a change; with kids out of school and the main channels in reruns, there’s more interest in premium channels and in the use of the Internet for entertainment.

A more significant marketing initiative by Verizon is an increase in the uplink bandwidth to accentuate an area where cable lags even with DOCSIS 3.0. FiOS uplink speed has doubled or more in the lower tiers of the offerings, but pushing how fast uploading content could be risks encouraging P2P, which is the form of consumer uploading most commonly used.

In cloud computing, the critical element is the ability to use policies to assign applications to resources from the “cloud pool.” Once assigned, the applications must be monitored as though they were components of a network service, and new assets must be substituted where SLAs can’t be met. Thus, cloud management is a lifecycle process, and we’re not seeing that reflected in all of the offerings to date. We also don’t see any integration of cloud and network operations, which is critical for meaningful SLAs.

So far, the recommendations for further protection are just a part of a draft document that hasn’t been presented to the EC, but regulatory trends have been showing a significant pro-consumer, pro-privacy shift. The result may be increased difficulty in monetizing not only social networks but also other online trends like video. In the U.S., the House is also closing in on privacy legislation that may well impact social networks and behavioral targeting.

In a competitive sense, it’s aimed at both Cisco and IBM, who have been increasingly offering integrated IT/network strategies. This sort of alliance is likely to eventually lead to M&A, though we don’t think Alcatel-Lucent and HP have any mutual intentions. While this is good for the buyer and the market, in the sense that it’s responsive to strategic trends, it shows that network vendors are increasingly facing commoditization at the transport/connection layer because the action is moving up the stack.