Cisco sweetens deal for Nexus 1000V amid tepid adoption

The Nexus 1000V virtual switch debuted to great fanfare in 2008, but now is being offered in a free version following relatively anemic demand.

IT shops might reconsider the Cisco Nexus 1000V now that there's a free version on the market, but adoption of...

the paid version of the virtual switch has been tepid among enterprises so far.

Enterprises that run VMware Inc.'s Enterprise Plus license -- or more recently, Hyper-V -- will have the option of using an Essentials Edition of the Nexus 1000V when version 2.1, currently in beta, ships before year's end. The Essentials Edition will include such basic features as the ability to provision virtual LANs, access control lists and apply Quality of Service policies, and manage Virtual Extensible LAN endpoints. The Nexus free edition also will include the Link Aggregation Control Protocol; multicasting capabilities; and NetFlow and Encapsulated Remote Switched Port Analyzer, or ERSPAN, for monitoring.

If IT pros want advanced features that aren't in the Nexus free edition (for example, Cisco's Virtual Security Gateway virtual firewall), however, they will have to pay for the Advanced Edition, priced at $695 per CPU. Cisco is also working on pricing bundles for the Advanced Edition that includes Unified Computing System, or UCS, servers, the ASA 1000V Cloud Firewall and the Nexus 1110 Virtual Services Appliance.

Shops which already have the Nexus 1000V are re-evaluating whether it's truly cost-effective. "We use the [1000V] internally and I am pushing to evaluate if we need it, given feature parity with the VMware vDS [vSphere distributed switch]," said Charlie Gautreaux, a senior engineer for a large financial services company.

Cisco has said that 6,000 shops have deployed the switch, but that number is actually relatively small, given Cisco's and VMware's vast customer bases. At last count by IDC, Cisco owned a little over 62% of the Ethernet switching market share; VMware, meanwhile, reports it has 300,000 total customers.

If two-thirds of VMware's total customer base is using Cisco products (a conservative estimate), that number of Nexus 1000V adoptees amounts to 3%. "The product received great fanfare when first introduced," recalled Bill Hill, a senior engineer working in the public sector. "[But] there were … major detractors that lead to a lack of adoption."

Cisco's misfire on the Nexus 1000V

So, what happened?

First, there's the requirement that VMware shops must already have VMware's most expensive vSphere Enterprise Plus license installed to use the 1000V, and that license also happens to entitle them to VMware's own vDS. Then add to that the cost of the Nexus 1000V, which some estimate ranges as high as $600 per socket.

In addition, VMware pros needed to understand the relationships between the Virtual Supervisor Module (VSM), Virtual Ethernet Module (VEM), vCenter and more, which wasn't really necessary in a non-1000V environment, users said.

Some shops also saw bugs and operational issues using the 1000V, especially before the latest version, which allows the VSM and VEM to be updated independently of one another. Previously the two needed to be on matching versions, and upgrades needed to be performed in precisely the correct order.

Finally, there was a general lack of an ecosystem for the 1000V, even competitively, until the very recent introduction of IBM's 5000V.

"Ultimately, Cisco needed to provide a product that competed with an incumbent product [the vDS] that 'worked just fine,'" Hill said. "With the pricing, complexity and the lack of any ecosystem, Cisco was fighting a losing battle."

'Freemium' model good news for Cisco shops

It's not just the cost savings that have existing 1000V users looking forward to the new version and new pricing -- they're also hoping for more company among their peers.

"With a lack of a larger-scale adoption across the enterprise IT world, there is a matching lack of knowledge and understanding for administration," Hill said. "More than anything, I hope to see some adoption of this beyond what the market has shown at this point to create more knowledgeable resources out there."

Cisco was also wise to get out in front of new trends in virtual data centers that may also threaten virtual switches, according to some observers. "With software defined networking becoming more and more common ... Cisco needed to do this to ensure they remain on the forefront of networking as it begins to move from physical to virtual," said David Davis, a virtualization evangelist at

Beth Pariseau is a senior news writer for and Write to her at or follow @PariseauTT on Twitter.

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