Cisco Systems

Cisco Systems (NASDAQ symbol: CSCO) builds much of the physical infrastructure of the Internet—the routers and switches that direct the streams of data between Web serv-ers and millions of users, as well as specialized networking, security, and storage devices.

Cisco was founded in 1984 by Leo Bosack and Sandy Lerner, a married couple who worked in computer opera-tions at Stanford University. (The name “Cisco” is from “San Francisco,” and the company’s logo is a stylized ver-sion of the Golden Gate Bridge.)

The company focused on networking at a time when that sector of the computer industry was still rather small. They were able to build one of the first routers that could link otherwise incompatible computers over the Internet. (Eventually, when the protocol was standardized (see tcp/ ip), routers could focus on the burgeoning traffic in IP packets.)

As the market for basic hardware became relatively sat-urated, Cisco began to emphasize the development of more intelligent “application aware” routing solutions as well as equipment geared for distributed processing (see grid computing).

Cisco grew along with the Internet/Web boom of the late 1990s. In 2000 Cisco was for a time the most valu-able company in the world, with a market capitalization of more than half a trillion dollars. (Today that has shrunk to a “mere” $180 billion or so—still one of the world’s most valuable companies.)

The “Last Mile”

In the telecommunications industry, “the last mile” refers to the connections and equipment that actually bring content to users’ homes and businesses. One source of Cisco’s con-tinued growth in the 2000 decade is the way it has addressed the consumer sector through strategic acquisitions. In 2003, Cisco acquired Linksys, maker of home Internet routers and wireless access points. In 2005, Scientific Atlanta—maker of cable modems, digital cable boxes, and other consumer equipment—also became a Cisco company.

The company has also entered the area of Internet tele-phony (see voip) by teaming up with Skype to build a cord-less phone that can connect to a computer to make phone calls over the Internet.

Moving from hardware into software, Cisco in 2007 purchased Utah Street Networks, a San Francisco–based maker of software to link online communities (see also social networking) and operator of the Tribe.net Web site. Around the same time, Cisco made a much larger buy, acquiring WebEx, maker of online collaboration software, for $3.2 billion.

In 2007 Cisco had revenue of $35 billion, with more than 63,000 employees.