Cisco Rival Blue Coat Is Looking to Hire

by: SA Editor Judy Weil December 01, 2008 | about stocks: BCSI / CSCO / IGM / IYW / PTF / WBSN    
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Blue Coat is in the process of integrating its Packeteer acquisition. The ride hasn't exactly been smooth, but Blue Coat (BCSI) says it is aggressively looking to hire sales teams-- albeit not necessarily for the best reasons. The company is cutting back on most expenditures, but unlike most tech co.'s, it's not cutting back on hires. Blue Coat also hasn't increased discounting of fees. From Blue Coat Systems Inc. FQ209 conference call:

Ideally, I would have liked to have been in the 130 or 140 [sales] reps as opposed to the 121 that we ended the quarter. And you can see even now, from the end of the last quarter to today, which is roughly about three weeks, we have hired seven reps and a couple of more will start in the next week.

We have a model about how we go to market and how we work with our partners and we have been combining the Packeteer and the Blue Coat channels together and so there has been a little bit of turmoil on that front and some turnover on the part of the sales teams.

Any time you do an acquisition and you combine two different organizations, at times people don’t want to work in a different way or don’t want to work under the same management team, they’re just not happy with what they’re ending up with there.

[It] has created a higher level of turnover than we probably originally anticipated on the field sales side.

Q: Do you feel this is a cultural issue that you have on your hands?

A: On the sales side, I think probably. Although I think the worst of it is behind us. We expected a fair amount of turnover, not quite as much as we got. And we had started looking to hire back aggressively and we just haven’t been quite as successful in that as we originally anticipated.

Competing with Cisco (CSCO):

They are with their security product, on selected cases, discounting very heavily in the security product that they have that competes with our security gateway business.

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