Cisco Systems is spending $1 billion on cloud computing

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Cisco Systems, Inc. is going to offer “cloud” computing services to corporate customers as part of a $1 billion spending plan over the next two years. Cisco could potentially eat away at Amazon’s cloud computing marketshare. Cisco is primarily known for its networking hardware business and is rapidly expanding into other markets. Cisco said that the spending will go towards building up data centers to run the new service, which will be called Cisco Cloud Services

“Companies are looking for different ways to get IT done,” stated Rob Lloyd, Cisco’s president of development and sales in a report by the WSJ. “Everybody is realizing the cloud can be a vehicle for achieving better economics [and] lower cost.”

Cisco will be selling its cloud services to telecommunications companies that will use them in a package of Internet-based services that the companies sell to others. The service will be tailored to work well with software from companies like SAP AG, Microsoft, VMware, etc.

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