Menu
Cisco to make US$10 billion investment in China

Cisco to make US$10 billion investment in China

The pledge comes despite the fact that Cisco's sales are weakening in China, amid cybersecurity concerns over U.S. tech

Cisco Systems Chairman and CEO John Chambers.

Cisco Systems Chairman and CEO John Chambers.

Cisco plans to invest US$10 billion in China, although its sales in the country are slumping due in part to persistent security concerns surrounding U.S. technology.

The investment marks a "new chapter" for the company, and it includes agreements with the Chinese government to expand in areas including research, and job creation, Cisco said on Wednesday.

The $10 billion investment will be made over several years, and will help spur technology innovation in the country, Cisco said, without further elaborating. It called the move a "renewed commitment" suggesting that the investment would be added on top of its existing operational expenses in China. Cisco could not be immediately reached for comment.

As part of the investment, the company has signed agreements with China's National Development and Reform Commission, a high-level government agency, and with an association connected to the Ministry of Education.

Cisco has been in the Chinese market for over two decades supplying networking equipment, including what's used in the country's Internet infrastructure. But its business in the country has struggled in recent years due to "geopolitical challenges", according to the company.

Following leaks about the U.S.'s secret surveillance programs, China has made cybersecurity a priority. As a result, the country is considering stricter regulations that could push U.S. tech firms out of the market.

In Cisco's case, it also had to contend with competition from Huawei Technologies and ZTE, two Chinese companies that have become major players in the networking sector and are moving into enterprise services.

But even as China focuses more on cybersecurity, Cisco said on Wednesday it's committed to the market. The company announced the investment as both its outgoing CEO John Chambers and incoming CEO Chuck Robbins met Chinese government officials.

Cisco will continue to "work closely" with the Chinese government and its partners to better meet demands for the market, Cisco's head of the Greater China Owen Chan, said in a statement.

Back in 2007, Cisco made another huge investment in the country that reached $16 billion. Most of the money was geared toward doubling its manufacturing.

The market opportunity in China is huge. The country has over 600 million Internet users, and there's a growing need for more data centers, and faster networking infrastructure.

Follow Us

Join the New Zealand Reseller News newsletter!

Error: Please check your email address.

Tags regulationNetworkingciscogovernment

Slideshows

Top 50 defining moments of the New Zealand channel in 2016

Top 50 defining moments of the New Zealand channel in 2016

Reseller News looks back on a tumultuous 12 months for the New Zealand channel, assessing the fallout from a year of sizeable industry change. Whether it be local or global mergers and acquisitions, distribution deals or job changes, the channel that started the year differs somewhat to the one set to finish it - Reseller News assesses the key moments that made 2016.​

Top 50 defining moments of the New Zealand channel in 2016
​Hewlett Packard Enterprise honours high achieving NZ channel

​Hewlett Packard Enterprise honours high achieving NZ channel

Hewlett Packard Enterprise honoured its top performing Kiwi partners at the second running of its HPE Partner Awards in New Zealand, held at a glitzy ceremony in Auckland. Recognising excellence across eight categories - from distributors to resellers - the tech giant celebrated its first year as a standalone company, following its official split from HP in 2015.

​Hewlett Packard Enterprise honours high achieving NZ channel
Nutanix treats channel partners to Christmas cruise

Nutanix treats channel partners to Christmas cruise

Nutanix recently took to the seas for a Christmas Cruise around Sydney Harbour with its Australia and New Zealand staff, customers and partners to celebrate a stellar year for the vendor. With the sun out, they were all smiles and mingled over drinks and food.

Nutanix treats channel partners to Christmas cruise
Show Comments