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Broadband's role still needs a push
By Geoff Hiscock
SYDNEY, Australia (CNN) -- Broadband's biggest issue is educating people and businesses on what it can do for their productivity, according to Cisco Systems executive Terry Walsh. Broadband, shorthand for high-speed Internet access, has been hailed in some quarters as the next big thing in information technology. But Walsh, who is Cisco's Sydney-based managing director for Australia and New Zealand, warns that broadband is not a panacea. "Broadband is simply the infrastructure for network applications. It is the services and applications that are important, rather than the size of the pipe," Walsh told CNN on Friday. He said it is clear that broadband usage delivers a productivity boost to business, with different surveys in Australia showing efficiency doubles and in some cases quadruples. But because of the way technology has been over-sold during the dot.com bubble, business is wary, Walsh added. The message of broadband has to be clearer, and has to make a sensible business case. Interest in China
Walsh said that, while Singapore and South Korea have some of the highest broadband penetration rates in Asia, it is in China where he sees some "really interesting" developments. "China is running fiber (optic cable) everywhere. It is going into apartment blocks and whole villages," Walsh told CNN. He said that means a whole new generation of Chinese children will grow up being very comfortable with broadband usage. When these children enter China's work force, Walsh believes it will have an impact that is "really hard to measure". He said it is likely they will use services and applications that are still to be thought of. Walsh said he would like to see greater acceptance of broadband in Australia, where only about 12 percent of households with a personal computer have high-speed Internet access. "Sixty to 70 percent is a better number. We'd like to see cheaper access," he said, citing Cisco's elasticity argument that the more high-speed access is rolled out, the more customers will come in, and the cheaper the carriers can make it. IP telephony's roleWalsh said he regarded Internet protocol (IP) telephony -- where voice as well as data can be routed over the Internet -- as a mainstream business offering now for Cisco. He said the technology is proven and reliable, to the point where the old-style PABX market is "dying rapidly". Cisco, the largest maker of networking equipment for the Internet, has been the most prominent global survivor of the tech downturn that began in early 2000. Earlier this week in the United States, Cisco reported a 50 percent jump in net income to $990 million for its fiscal second quarter, despite a drop in sales to $4.7 billion from $4.8 billion a year. The company warned that sales could fall again this quarter, and said it is putting more of its R&D budget into higher-growth areas such as optical networking, security and storage. But Cisco still gets two-thirds of its revenue from routers and switches. Under CEO John Chambers, Cisco has been an aggressive competitor in the IT world. Last month, Cisco filed a suit in a Texas court against the Chinese telecom equipment giant Huawei Technologies, charging patent and copyright violations. Cisco claims Huawei is using source code for the software running its routers that is identical to Cisco's.
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