Business Case Studies, Leadership Case Study, Tata Group,Ratan Tata

Code : COM0039

Year : 2004

Industry : Engineering, Electrical and Electronics

Region : USA

Teaching Note:Not Available

Structured Assignment :Not Available

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Introduction:On May 25th 2004, Cisco Systems (Cisco) – headquartered in San Jose, California-unveiled its much awaited top-of-the-line, high-end router - Carrier Routing System-1 (CRS-1), code-named 'huge fast router' (HFR). Cisco dominated the Internet router business, as the primary supplier of routing technology to Internet service providers (ISPs) and large companies. CRS-1 was targeted at phone companies and ISPs, who were vying to build a new generation of Internet-based networks that would carry phone calls, video and other data. CRS-1 was launched at a time when Cisco was facing intense competition from amuch smaller company, Juniper Networks (Juniper).

Though Cisco remained as a dominant force in the overall networking market, it was losing ground to Juniper in the most expensive, high-end router segment - 'core routers', which made up the backbone of the Internet. These high-end routers facilitated the movement of high-bandwidth applications such as video-on-demand, online gaming and other real-time services across the Internet. According to market researcher Dell'Oro Group, Cisco's share of $733 million market fell from 70% in mid-2002 to 59% in first quarter of 2004, while Juniper's had jumped from 23% to 34%. By launching CRS-1, Cisco hoped to catch up with Juniper, especially at a time when telecom companies looked for new Net-based routers to replace decades-old telecom voice network.