Cisco Systems Inc and Sanford Bernstein Tech Talk on Cisco's Cloud Computing Strategy Conference Call Summary

The following is excerpted from the question-and-answer section of the transcript.

Question: Pierre Ferragu - Sanford C. Bernstein & Co. - Analyst : Yes, thank you very much, Nick. So I'll probably start the Q&A session and then we'll go with questions from the call. So Nick, as a first question, I think you said two things that were very interesting about the evolution of the cloud landscape. So you quote Nadella first, go big or go home, and then you talked about all these people that told you I want the data center in my country, and I want the data center that's operated by a company registered in my country. And what we see today in cloud is that everybody wants to do cloud so you have like the larger public infrastructures, of course, but all IT Service Providers, a lot of local players, most of the telecom operators want to do cloud as well, so how do you see this landscape structuring, what is like the cloud end game? Are we going to have thousands of service providers, or do you think the market is going to concentrate, and if it concentrates, around which type archetypical models do you see that concentrating?

Question: Pierre Ferragu - Sanford C. Bernstein & Co. - Analyst : Thanks, very clear. One quick follow-up before I open the Q&A to the audience. So you think the ones following the pure CapEx model is going to be tough for them to make money. So how do you approach cloud vendors, and how do they react to intercloud, don't they see that as a threat to be commoditized, and so what's in it for your partners? How do you convince partners to join the intercloud?

Question: Pierre Ferragu - Sanford C. Bernstein & Co. - Analyst : Thank you, Nick and we'll open Q&A for participants, if there's anyone willing to ask a question.

Question: Amitabh Passi - UBS - Analyst : Thank you for taking the call. Really appreciate it. Nick, I just had maybe a clarification for you. You talked about your partners including DT, BT, some of the large service providers, including Telstra. I think in the case of Telstra you've been pretty clear they are enabling or building some of their clouds based on ACI. Can you clarify whether BT and DT are also using ACI, or they're predominantly using the intercloud fabric to interconnect the clouds?

Question: Amitabh Passi - UBS - Analyst : Okay, appreciate it, thank you.

Question: Pierre Ferragu - Sanford C. Bernstein & Co. - Analyst : Ryan?

Question: Pierre Ferragu - Sanford C. Bernstein & Co. - Analyst : Thanks a lot, Ryan. Nick, do you want to add something or do you want to move on to the next question?

Question: Pierre Ferragu - Sanford C. Bernstein & Co. - Analyst : Thank you, Nick. I'll take a question that I received by e-mail. Very pertinent one and very timely. So you talk a lot about service providers investing in the infrastructure, in order to be able to join the cloud, and also intercloud services, but we had a lot in the recent news was spending coming down, AT&T talking about lowering CapEx so what's your perspective on the timing of the ramp up of the intercloud? Do you think it's a buildout of the intercloud could be actually hurt by the current cautious CapEx environment?

Question: Pierre Ferragu - Sanford C. Bernstein & Co. - Analyst : Thank you and then still, on this service provider partners that you mentioned you have already signed more than 30 of them. What's your sense of the strategy? How many of them do you think are going for like the 100% Cisco intercloud strategy, and they are going to invest going forward only in Cisco's technology? And what proportion of them are actually following a dual track strategy where they will have Cisco data centers on one side and actually a different approach, like for instance the Wide Box approach, or an approach with other vendors on the other side?

Question: Pierre Ferragu - Sanford C. Bernstein & Co. - Analyst : Great, thank you. Thank you guys, and Kirk maybe if we can take another question from the audience if you have questions in your list?

Question: Pierre Ferragu - Sanford C. Bernstein & Co. - Analyst : Great. Thank you very much.

Question: Pierre Ferragu - Sanford C. Bernstein & Co. - Analyst : Thank you. And so maybe we just have a couple of minutes left so I'd like to conclude with two questions, Nick. First of all the development of the ecosystem so you started with Telstra, which sounded very excited but was a limited footprint. Now that you have Deutsche Telekom and British Telecom and your network of partners has already taken a very significant momentum. And of course the key question here is are you going to sign one of the large US operators, with how many of them talking about breaking free from the network vendor, the kind of policy I'm referring to, so it feels like signing up to intercloud would go against that kind of mindset. So what kind of update can you give us on that phone?

Question: Pierre Ferragu - Sanford C. Bernstein & Co. - Analyst : Thanks a lot Nick, Carl and Ryan for your participation. I think we've exceeded the hour we had booked for this conference, so it's time to conclude, Operator.