11:50 AM -- Despite posting a strong set of Q1 results, Cisco's storage growth has slowed significantly, suggesting that the networking giant is engaged in a fierce market battle with Brocade. (See Cisco Reports Q1 and check out our latest poll.)
The networking vendor has been increasingly focusing its efforts on the storage market, recently unveiling its Wide Area Application Services offering in an attempt to tap user demand for storage and server consolidation.
Cisco's storage push has historically brought results, with the vendor's storage division experiencing 65 percent growth last quarter, thanks largely to the strength of its switch and director business. (See Cisco Rattles Storage Sabre, Cisco Goes 4-Gig & Big, and EMC Certifies Cisco Director.)
But the vendor's Q1 results, released last night, show Cisco's storage growth slowing to the mid-teens, although execs on a conference call painted a rosy picture of their storage business. "We're getting huge market share [on storage]," said Cisco CEO John Chambers, explaining that he expects strong growth in the future.
Cisco execs on last night's call did not explain the reasons for their storage slowdown, though Brocade has been enjoying strong demand for its own director products, suggesting that the networking vendor may be coming up against some stiff competition. (See Brocade Reports Earnings.)