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Cisco Resales
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By Ed Foster, Section The Gripelog
Posted on Tue May 13, 2003 at 09:01:05 AM PDT
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Readers had a great deal to say in response to my recent column about Cisco. In particular, many expressed sympathy for the customer who was told he must re-license the operating system for a Cisco router he purchased in an online auction. Comments about how such a policy might be applied to the auto industry abounded:
Imagine I bought a Chevy. I sell the Chevy to someone else. GM says the software embedded in the Chevy is licensed and the new owner must pay to get another license. If the software is removed, the engine won't run. But no one sells any alternate software because the hardware, like the software, is proprietary. How is this situation different from the Cisco one? Wait a minute. Don't tell GM.
Quite a few readers were well aware of Cisco’s policies in this regard, having run into it themselves. And, in some cases, Cisco’s policies seemed to go even further.
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Last year we were looking for new switched hubs to replace an old IBM Token Ring system converting to Gig Ethernet. While we were evaluating Cisco and other solutions, the lease company that underwrites most of our IT equipment called to say they had what we were looking for new in the sealed box at 60% off. Our network and Cisco support determined that we would have to re-license the Cisco software and included that in the deal. Well now Cisco has determined that though the software is OK the hardware has to be certified by Cisco engineers taking the network down so they can inspect the cards. So network support will be in tomorrow a day they would have had off, while Cisco gouges us for $8,000 to certify new equipment. It’s not just for software anymore.
The problem goes deeper than that, however. Several readers noted that Cisco is not the only hardware company that take this position.
The effect of course it to diminish the value of the equipment that customers have bought from a manufacturer by killing off the secondary market. It is clear why the hardware makers do this, what isn't clear is why customers put up with it. We have encountered the Cisco policy before - and we have complained to Cisco about it - no response. Our worst case is: NetApps (Network Appliance). We purchased a used NetApps system on e-bay for $4,000. NetApps wants $15,000 for the software license! Some hardware companies will split the difference by granting the software license with the purchase of a maintenance contract, but not NetApps.
That raises several questions we should try to answer. How many hardware companies do this? Is it even legal for them to do so? And, to reiterate the reader above, why do their customers put up with it?
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