In the present paralyzed economic conditions when firms are squeezing their operations, the networking giant Cisco continues to be a relentless pursuer that forays into newer markets. Cisco's current footprint in the data center market is full of core virtualization opportunities. The company's move would make its current partners tremble as also the major players in the area like HP, Dell, and IBM, who reap the $50 billion server market.

Cisco's new thrust is in the area of virtualization software, which allows companies to run multiple business applications on each server, saving electricity and getting more use out of hardware purchases. The software also has had a growing impact on business computing systems; the mobility of virtualization software blurs the line between network hardware, computers, and storage systems. Cisco sees this as a chance to create new management systems that expand across whole data centers and allow the customers to manage their data centers as a single entity.

Rather than pursuing HP and IBM's computer-centric approach for data center management, Cisco believes that a data center can be managed through the network switches and routers by virtualization. While Padmasree Warrior, Cisco's CTO, explains that the company is only trying to adjust to new technologies, the impact of this adjustment on Cisco's relationship with other companies remains to be seen, while it has a legacy of acquisitions.
"Cisco's success has always been driven by investments in market adjacencies during times that may cause other companies to blink," says Warrior. After years of dominance in the routers and switches market, the current move of Cisco is a venture into a core area of IT, while it already has a presence in areas like software and computing hardware. And now, within a few months it will have a foothold in the server market too.