Cisco and other networking stocks plunge amid Amazon competition fears
Large networking companies like Cisco Systems Inc. , Arista Networks Inc. and Juniper Networks Inc. were hit in Friday trading by a monster that has already rampaged through other sectors: Fear that Amazon.com Inc. will make a challenge. The Information reported Friday that Amazon is considering selling its own network switches with built-in connections to its Amazon Web Services cloud-computing offerings. The generic networking equipment would be based on open-source software and sourced from “white box” manufacturers, which would likely make the product much cheaper than offerings from the larger networking companies. Facebook Inc. has put out its own networking designs that utilize white-box switches, and the equipment is widely available directly from the manufacturers, but that has not stopped Cisco from dominating the industry while Arista offers high-performance gear and Juniper aims for telecoms and other specialty areas. All three networking companies were specifically mentioned in The Information’s report. Cisco stock fell more than 5% after previously trading at a gain on the day, while Arista fell more than 5% and Juniper declined more than 3%. Amazon, which has hurt the retail sector with its ecommerce dominance and previously spooked the grocery sector before and during its acquisition of Whole Foods and the pharmacy and health care sectors while making plans to challenge there, gained slightly Friday while topping $1,800 for the first time. The S&P 500 index was trading about 0.1% higher Friday.
Source : MTV
