Cisco is in hot water because its sales teams sold hundreds of high capacity routers to the State of West Virginia which it did not need.
According to the Charleston Gazette, governor Earl Ray Tomblin has ordered state officials to reconsider where they've installed hundreds of high-capacity internet routers paid for with $24 million in federal stimulus funds.
The state placed oversized routers are in hundreds of public facilities which not only would fail to stimulate anything, but pretty much act like a chocolate teapot when it comes to internet use. Each Cisco 3945 series router cost $22,600. Hundreds of them have already been installed in "community anchor institutions" - schools, libraries, planning agencies, health centers, state police detachments, county courthouses, state agencies and other public facilities.
State and federal lawmakers also have slammed the router deal and Tomblin plans to appoint a group made up of technology experts from state government and the private sector.
Cisco said it would take back routers if West Virginia can't find an appropriate place to put them, although there have been some suggestions from the governor's office.
John Earnhardt, a Cisco spokesperson, said that there would be no problem in Cisco taking the routers back.
He said that there was a positive impact of broadband infrastructure on education, job creation and economic development, which is well established.
The routers were delivered in July 2010 but many remained boxed up in storage. The state paid $8 million for a five year warranty on the routers. Cicso has given the state a three-year extension on the warranty because they were not used.
Cisco claims that this is to show the company's commitment to the project.
The question is why Cisco even suggested the routers to small community groups, and why government officials gave the idea the thumbs up.
CEO John Chambers hails from West Virginia so should know which sort of routers its public libraries need, and they probably did not need bullet proof heavy duty versions. For the use that some libraries get they probably would have been happy with dial up.