Amazon’s cloud service business ‘Amazon Web Services’ is eyeing to sell its own networking switches to the business customers. Amazon Web Services could price its white-box switches 70-80% less than comparable switches from networking giant Cisco, as reported by one of the persons with direct knowledge of the unit’s plan.
The company expects to launch the switches in the next 18 months. It stated that the devices will include open-source software and unbranded hardware known as “white-box” switches and will be introduced with built-in connections to AWS cloud services, such as servers and storage.
Amazon Web Services (AWS) offers reliable, scalable, and inexpensive cloud computing services. It is a subsidiary of Amazon.com and offers on-demand cloud computing platforms to individuals, companies and governments. It started to offer IT services to the market in the form of web services, which is nowadays known as cloud computing.
“If true, we think this would be a notable negative for the networking equipment space going forward,” RBC Capital Markets analyst, Mitch Steves stated.
Shares of Cisco Systems and other network gear makers such as Juniper Networks and Arista Networks came down between 3% and 5% after the news. The shares of Cisco were decreased 5%, removing off nearly $11 billion from its market capitalization.
Well, this might take some more time for Amazon to come to a proper conclusion and decide clearly what is required to be done.