In part one we talked about disruption in Layer 1. After Cabeltron, other companies entered the market with innovations in Layer 1. Notably Synoptics and Chipcom who were challengers to Cabletron. Chipcom came up with improved hardware with high-density ports. Synoptics tried to play dual role, supporting Ethernet (10BaseT) and Token-Ring. Token-Ring was the technology that IBM promoted to control the Mainframe market. There were two versions of Token-Ring technologies introduced – 8MB and 16MB. However, the biggest disruption that entered this phase was at layer 3. Cisco introduced the Access Gateway Switch that could switch packets between two different Local Area Networks. These Access Gateway Switches were hardware based and configuration was done through DIP-switches on the interface boards. Hence, IP technology started to dominate the industry. Other competing technologies such as SNA, DECNet, Banyan Vines, AppleTalk and Novell were competing the market to dominate.
The ability for Cisco to dominate was due to the fact they started disrupting the Layer 3 market. Cisco pushed IP in the forefront, supporting all layer 1 and layer2 technologies but promoting Ethernet as the direction to move. This was the era when customers were trained on IP address schemes, dividing the LAN into multiple segments and the ability to talk to each segments. This was the time Cisco made the first swipe at SNA, talking to people about Client/Server and local control of the assets. Using Novell first and then supporting Microsoft in introducing client/server technology that could help customers control their own applications, move at a pace that the customers could move and alienating Mainframe. Cisco also came up with the idea of connecting remote sites using low speed links (56KB/64KB). Routing protocol RIP was rolled out and hence disruption in the networking industry started. The networking industry was moving at a pace that took other competing protocols by surprise. DECNet and AppleTalk lagged and therefore became obsolete. Cisco integrated SNA into IP through DLSw and slowly forced IBM to drop Token Ring and move to Ethernet. Routing protocols such as EIGRP and IGRP were introduced to connect remote sites. Large ISPs such as BBN, UUNet became the incumbent providers to transport packets to remote sites. Once Cisco dominated this market, they went out and bought layer 1 companies such as Kalpana and introduced Ethernet Switching. Cabletron and Synoptics failed capture the switching market and hence they slowly faded away giving way to Cisco to introduce Catalyst Switch (Ex Kalpana Switch).
EIGRP and IGRP were all Cisco proprietary protocols and the networking world wanted an Open Routing protocol that could connect multiple vendor products such as Welfleet (Bay Networks later). OSPF then and now OSPF v1 was introduced and hence the war on routing technology took off. Cisco at this point started to dominate Layer3 market and slowly took control of Layer2 using Ethernet Switching. First introduction of virtualization came in Ethernet called Virtual LAN (VLAN) that Cisco dominated.
Next part talks about Client/Server innovation and the need for Data Center that will lead us to disruption in Virtualization, NFV and SDN.