Cisco Shift Gums Up the Works for Rivals

Cisco has recently added "we are a hardware and a software company" to its message to investors. And given the luxurious margins enjoyed by software companies, the advantages of diversification aren't lost on Cisco executives.

"There is a giant rummage sale going on," says Wohl. "If you are a company with a bunch of money, there's never been a better time to put something you've wanted in your portfolio."

"They can offer some sort of network management scheme of their own," adds Wohl, "or instead, have their stuff managed by someone else's." Put that way, it seems clear where Cisco's headed.