After years of stagnant or lackluster growth, Extreme Networks tapped Oscar Rodriguez to bring new life to the switch maker in 2010. He scrutinized global operations, streamlined the product line and brought a new focus that he says will really come through this spring with a new wave of switches. Rodriguez shared his goals for Extreme in 2012 with Network World Editor-in-Chief John Dix and Managing Editor Jim Duffy.

Can you start by giving us a review of 2011 and what kind of progress you made, and how you plan to map that into 2012?

2011 really is a transition year for Extreme. I came on board at the end of August 2010, and my first three months here were really going around the world and talking to customers, partners and our own internal teams with an eye towards understanding what are our competencies, lining our competencies up with where the market is going. By December 2010 we had a strategy together of what we were going to do and we announced that strategy in January: Extreme was going to focus on specific market verticals. We selected three market verticals: cloud services and cloud computing; education; (and) large-scale mobility. You've got to have products that are purpose-built for mobility, purpose-built for the cloud, and the operating system is really now purpose-built for a lot of the things going on in education and that can then dovetail in to healthcare and other things like that. We also selected those verticals to have a halo effect on other things that we were doing in the business so we weren't going to give up the ghost on the existing business.

What we've done is selected places that we're going to compete from a focus perspective, and what that enables us to do is really two things: focus your R&D on building very specific products for those areas as opposed to trying to address the wide requirements and the wide marketplace; the other is it lets you focus your marketing and market awareness generation in those specific places where you want to win. So that's really our goal -- it's to really focus in those spaces and not ignore the rest of it. We removed old products that were not focused on these new markets. Then in the June quarter and September quarter we made significant changes to the staff of the company, we've reduced in places where we didn't need specific staff, we reduced products, we changed processes, we've made ourselves more efficient. We're in our new cost structure and have our new strategy going out the door and in to January.

How are your customers responding to your organizational changes, your product line changes, your vertical market focus?

Very positive, very positive responses. We're doing a lot of outreach and awareness, not only to existing customers but new perspective ones. I can tell you this - the feedback from the customer advisory council is we've never seen Extreme so focused, we really like it, and we believe in what you guys are doing. But what's interesting is we're now getting customers at the CIO level inviting us to come in and present to them, and really be a part of their bidding process, that would never have given us the time of day before because they would just have considered us to be a commodity product.

In this change, how many customers in these sectors that you're turning away from are there? How many existing customers are left in those buckets that you'll no longer be focusing on?

Not a lot. That's the good news, right? I mean the good news is what we were trying to do before as a company was sort of chase customers that we were hopeful to get. The nightmare scenario for any product company is you want to land hundreds of customers in order to justify your ROI and if you land three or four, and then you're kind of stuck servicing those three or four with the R&D that it takes to service those three or four, you're not getting the revenue of the hundreds.

So the good news is it was an easy decision. I had one product for example in the Carrier Metro Ethernet space that had more R&D spend than it had revenue in the quarter. So you don't have to be a genius to do this, you just have to sit down and say are we going to take the steps that are necessary to get it done.

How do you plan to build on what you accomplished in 2011?

In the process of making all these changes as a company, we actually then set our criteria for the products we're going to build, and we've got brand new products that are coming that will be available in the early spring. And as these products come out, they're very focused on very specific areas. So we're getting these products out the door, but 2013 is really where we're expecting to see growth.

How do you plan to sell beyond just your installed base and cultivate a new set of customers?

Being able to acquire new customers has everything to do with awareness. Your current customers are already aware of you, so it's easy to go back to your current customers without having to do a lot of marketing. When you're trying to get your message to new customers, there's a couple of things that have happened over the last 10 years that have been impediments. Cisco had such a strong position in the marketplace that there were many customers that said, "I don't necessarily want to buy from anybody from Cisco, I feel safe, I think it's OK, they do a great job." The other one that's been a greater impediment for Extreme is the fact that Extreme really didn't invest a lot in the awareness that is necessary.

When I got on board here we were spending a lot of money in corporate marketing and not a lot in field marketing. And the way you generate awareness for customers is, you have to advertise globally and you've got to be able to do it in a way that's affordable to you and local venues around the world. The only way to really get that done is to spend your money in field marketing, not on corporate marketing. So awareness generation is a big deal when you're trying to land new customers. And I think it's very fair that in the last 10 years we really had not been focused on key awareness generation points. I think we are now.

What's at the top of your priority list for 2012?

The first set of goals is to get our products out the door. They're due in the early spring and I believe that they will be on time with no issues. The second set of goals is to make sure that all of our salespeople are trained to be experts. One of the things that we're also doing is revamping our sales force, not only retraining the internal folks but adding people from the outside. I'm looking for really great salespeople that want to have a lot of upside. We can bring people on board that have a Rolodex and we can train them to be the black belts in data centers. We're shaping ourselves to be that kind of vendor.

A lot of the other big players are starting to integrate their networking in the computing side of the house. How do you respond to that market dynamic?

It's a dynamic that's bound to happen because if you're a large comprehensive vendor, you want to be able to offer service capability. In the case of any of these large vendors, they're really selling a service. You'd have to be able to bring together multiple pieces, so you're not just selling consulting, you're selling also product and the know-how of the overall system.

That does not mean, however, that there isn't a very large part of the marketplace who will say, "I want to be able to choose those pieces for myself, I want to choose best of breed." Unless you've got a very esoteric technology, they would rather select the best of breed for themselves because that way they control their cost of goods, they control their facilities usage, they control their people and they have enough technical depth to be able to run it themselves.

There are a lot of corroborating activities going on in the marketplace that say if you choose from a big brand, you're going to suffer in one or two areas. Performance of the overall system may be very good, but the individual components may be mediocre. Unless the big brands can overcome the performance perception that they have, and the very real overall economic issues of having sub-optimized systems as opposed to optimized systems, then I think there's always going to be room in the marketplace for those customers that choose best of breed.

What do you see as your major challenges in 2012 as you build upon what you accomplished in 2011?

Customer perception - making sure that we drive our customer perception as quickly as we possibly can. The more that we build customer awareness of our products, the sooner you get into the game, the better off you are. The other thing is having the denser boxes. You lower the power consumption per port, you make the network physically smaller so you're using less racks to run the same size of network. With our BlackDiamond X8 you can fit nearly 2,300 10G ports in a rack. That's unheard of -- nobody can do that.

So if you're a cloud guy, you want the network to be as small as possible, use up the least amount of room, because that way you have more racks for servers, more racks for virtual machines, more racks for storage, and that, in essence is what you sell -- you sell virtual machines and you sell storage. That maximizes your revenue out of the same facility size, and lowers your overhead. So we have to make it as small as possible and as quiet as possible so that these cloud guys can pay attention to the important things, which is driving more revenue and driving more virtual machine space.

Is some of that to say that you're advocating for flatter networks like a lot of the other guys do as well?

It's got to be flat, you've got to reduce the numbers of tiers. The old multi-tier way of doing this doesn't work. You've got to be able to have active-active switching. You've got to be able to have multi-path capability. What it does is it lowers the number of tiers, makes things highly redundant and fault tolerant, and if you can then put it in a nice, dense package, you've got an advantage for a cloud operator that's unheard of.

Juniper is out there talking about the need for single-layered - not even two-tier stuff, but do you go that far? Or do you think two tiers will suffice for many customers?

Yeah, the BlackDiamond can do one tier, and because it's so dense, we can do one tier with a single box. The way Juniper has done things, they've said, "OK, do all these multiple boxes, we can make it look like one tier." The problem is, now you're locked in to Juniper. So I kind of look at Juniper like the way Bose has done their audio system -- very high fidelity, no doubt about it, but you've got to cable your house differently than everybody else does. You don't want to do that non-standard cabling because now you're stuck. You're always going to buy a Bose system no matter what.

How many server nodes can you support from a single switch?

We can do 768 10G server ports on one (chassis) so that's three times that in a rack. Or 192 40G ports. We were first to market with 40G. We now have the most comprehensive portfolio in 40G capability, and we'll continue to push on that and continue to bring more 40G capability out.

If you look at the combination of 10G and 40G, that's really being driven by what's happening at the server level... thanks to Intel's work on moving 10G onto the motherboard. So any high-performance data center and high-performance cloud capability is going to be 10G at the server with very speedy processors to maximize the number of virtual machines. And then that network is going to have to provide 10G access to the server and then 40G trunking so that you can operate in a fully meshed environment and be able to give any server access to any storage or any other server at any point in time. When virtual machines move around you never can tell which physical server they're going to sit on.

With Foundry being sucked up into Brocade, does that simplify your life or complicate it?

It's better for us. It simplifies our life, because I think Foundry was a very good executing company, to be frank. Bobby Johnson ran a really good company. He in essence ran a very customer-focused company and as a result of that they were really a very vehement competitor. When I look at the acquisition by Brocade, it's taken them a while to get everything integrated. They're a good competitor now - don't get me wrong, I'm not throwing a stone over there - but I think that anyone who is going through the transition of old technology to new technology gets slowed down to a certain extent.

I look at Fibre Channel as the TDM of storage. When you're trying to balance the current with the future, it's a lot harder, and I think I like that better from a competitive standpoint.

As you focus on data center cloud fabrics going into 2012, are there any pieces that are missing right now that you need to have in order to fulfill that mission?

One thing I think is very important is policy management and networks. We've had the luxury in the networking industry for many years to just throw more bandwidth at the problem. As soon as anything got congested, just throw more bandwidth. As soon as you needed to have mission-critical information, add another switch. If you needed to have quality-of-service issues, you could just give it tons of bandwidth and it will resolve itself.

It's getting to the point where, thanks to applications that are coming from the mobility side, every iPad and every Android (device) is going to have a different set of applications per user and so the traffic is no longer predictable. You've got to have policy that's applied that is based on the criteria of what we should be allowed to do on the network, the types of resources we should be allowed to access, the kind of bandwidth and quality of service that we need to have, and that needs to go all the way back into the data center.

We're going to see quite a bit of policy management start to be required and necessary, in addition to security management inside the data center for intra-data center productivity between applications and VMs, and the network has a big part to play there.

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