IT departments that take advantage of an influx of cheap
imports of Cisco equipment, discounted at up to 70% on normal
prices, could be left with substandard equipment and no proper
support, it was claimed this week.
The warning follows revelations that suppliers are buying up
discounted Cisco equipment intended for the Chinese market and
excess stock from wrongly calculated manufacturing runs, and
shipping it back to the UK.
"Discounts given on grey goods can range from 10% to 70%. The Cisco
channel is totally out of control and Cisco does not appear to
care," said one Cisco reseller, who asked not to be named.
Analysts warned users to find out if grey goods were included in
low-cost deals as there could be issues of device quality and
support which may not be justified by the smaller initial
outlay.
"The capital outlay on networking equipment is a small proportion
of total cost of ownership - the bulk goes on support and
maintenance - so it is often not worth skimping," said Andy Rolfe,
an analyst at Gartner.
Where kit has come from a discounted consignment intended for
another customer there could be problems with legal title to
software, which could affect a user's right to software support and
upgrades, Gartner said.
A Cisco spokesman said, "Cisco software licences, warranties and
support services do not transfer to new owners when used equipment
is sold through the grey market. Individuals that purchase
equipment from the grey market will not receive the product support
and other benefits that are typically associated with Cisco's
brand."