Amazon rumored to be entering the networking market

It’s hard to remember a time when people thought Amazon was nuts for going into the cloud computing business, since it was so far removed from the company’s core ecommerce business. No one is laughing now.

It seems history could repeat itself. According to an article in The Information, Amazon is rumored to be targeting a new industry, albeit one dominated by a giant player and multiple healthy competitors — the network switching business. The move would put it in direct competition with Cisco, HPE, Juniper Networks, and Arista.

“As it does in many other categories, Amazon plans to use price to undercut rivals,” the report said. “The company could price its white-box switches between 70 percent and 80 percent less than comparable switches from Cisco, one of the people with knowledge of the program estimated.”

Now, Cisco products aren’t cheap, but how do you undercut it by 70 to 80 percent and not bleed money, even if it’s a loss leader for cloud services?

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