Cisco sees new product raising core router revenue to $10 billion

Reuters News
Posted: Jun 12, 2013 12:05 PM
Cisco sees new product raising core router revenue to $10 billion

By Sinead Carew

NEW YORK (Reuters) - Cisco Systems Inc predicts that a new product it unveiled on Wednesday will increase its cumulative revenue from core routers, which direct Internet data traffic, by 25 percent - to $10 billion - within the next two years.

The leading network equipment maker expects to cash in on ever increasing demand for Internet services with its new CRS-X router, its third in the CRS product series.

Since the first CRS router made its debut in 2004, Cisco has brought in a total of $8 billion in revenue from the product range, according to Stephen Liu, Cisco's director of service provider marketing.

"The CRS-X is the innovation we need to cross the $10 billion barrier," Liu told Reuters ahead of the Wednesday announcement.

In comparison, Cisco reported total revenue of over $12 billion in its most recent quarterly report.

Cisco said it has already confirmed that the top U.S. service provider, Verizon Wireless, and SoftBank Corp, one of Japan's biggest mobile operators, plan to use the latest router, which Cisco will deliver later this year.

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The new CRS-X router can handle up to four times more network traffic than its previous version, the CRS-3, which was launched in 2010, according to Cisco.

The CRS-X can handle 10 times more data than the first CRS router in 2004, Cisco said.

Its rivals in the core Internet routers sector include Juniper Networks Inc and Alcatel Lucent SA.

(Editing by Phil Berlowitz and Jan Paschal)