Cisco (CSCO) and HP (HP) have been duking it over their visions for the next generation data center architecture and the battle is just getting interesting. Cisco entered the server market and HP has countered by purchasing 3Com for $2.7 billion.

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Clearwire (CLWR) today announced the launch of its a developer version of 4G service in the Bay Area. The developer version of the WiMax-based network covers “more than 20 square miles” in Santa Clara, Mountain View and “parts of downtown” Palo Alto. (Parts? Downtown Palo Alto isn’t that big; it only cover parts of it?) Clearwire notes that the service area includes the headquarters of both Intel (INTC) and Google (GOOG); the Cisco (CSCO) campus will be adding “in the coming months.” All three companies will be
“partners” in the project, the company said.

Clearwire plans to launch full service in the Bay Area in 2010.

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There are growing signs of tension between some of the players behind the $2 billion deal to sell eBay’s (EBAY) Skype to a group of investors.

On Friday, Joost, the U.K. Internet video company, said that by shareholder vote it had removed Michelangelo Volpi from its board of directors and from his position as chairman of the company. Volpi, a former high-level Cisco (CSCO) executive, stepped down from Joost’s CEO position in July, and is now a general partner at investment firm Index Ventures. Joost in a statement said it was also “conducting an investigation into Mr. Volpi’s actions during his tenure as CEO and as Chairman.”

In his role at Index, Volpi helped organize the group of investors that’s buying Skype from eBay. Yet Volpi’s relationship with Joost could prove important to the Skype deal coming to a clean conclusion.

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I guess no one has a clue what the increasingly fashionable term “cloud computing” means. At least, that’s the message we’re meant to take away from a new video from Cisco (CSCO), where many people are asked what cloud computing is, and most of the on-camera responses are confused, way out there, or both.

Here’s my favorite description: “Cloud computing is where God allowed all the clouds to be connected together by the angels.”

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VMworld, the annual conference hosted by software maker VMware, is fast becoming one of the hot tech conferences, in large part because VMware’s technology has become an important selling point for tech-equipment makers like Dell (DELL) and Cisco (CSCO) Systems. There are likely to be dozens of new product announcements made at the conference, which kicks off Monday.

One company isn’t waiting. Arista Networks on Wednesday announced it has developed software for its gear that makes it easier to manage servers that run VMware’s “virtualization” software. A virtualized server can run up to 20 times the number of programs as one without the software, which is a big efficiency improvement for information-technology departments. But it’s also created a new problem: How do you keep track of everything running on these servers and make sure they can be accessed through the network, which is made up of physical devices called switches?

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Cisco Systems (CSCO) has overhauled its management structure in order to support 26 new businesses that the company says could soon reach $1 billion each and account for more than 25 percent of Cisco’s revenue.

Now executives work on committees–dubbed councils and boards in Cisco-ese–and the company makes 70 percent of its decisions collaboratively, up from 10 percent just two years ago.

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Expectations have been building for Cisco Systems’s (CSCO) fiscal Q4 report, which comes tomorrow, after the bell. Deutsche Bank last week forecast a “beat and raise” report, while Pacific Crest discussed prospects Cisco’s enterprise customer base is going to rebound for the company.

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Online scam artists are borrowing customer-acquisition and partnership strategies from legitimate marketers, a Cisco (CSCO) security executive says.

In conjunction with the company’s midyear security report, Patrick Peterson, Cisco’s chief security researcher, said in a Webcast that the increasing sophistication of the cyber criminal is one of the biggest threats security experts face.

“A lot of these things you would learn if you went to Harvard Business School,” he said. “The criminals that we study make money, and they’re successful in their markets. And they’re applying those same lessons, those same cyber-MBA lessons to what they’re doing. It makes them, again, a much more virulent enemy.”

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SAP’s new CEO Leo Apotheker says the software giant will focus on its core software business, even as its rivals expand beyond their traditional boundaries.

The latest trend in the tech industry–at least among its biggest companies–is to offer products and services that used to be provided by partners. H-P (HPQ) expanded into consulting last year when it bought EDS, Cisco announced in March that it was moving into the server business, in April SAP’s (SAP) software rival Oracle agreed to buy hardware maker Sun Microsystems (JAVA), and in June, Intel (INTC), which makes chips, agreed to buy a software company.

SAP has no such ambition, says Apotheker. Whereas Cisco (CSCO), Oracle (ORCL) et al. say that they can reduce complexity for customers by developing all-in-one products, SAP plans to keep making software and work with partners to achieve the same goal. “People want to reduce complexity, but they don’t want it all to come from one company,” he says.

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Cisco (CSCO) CEO John Chambers doesn’t just talk a good game about telepresence, the videoconferencing technology that creates the illusion you’re in a room with someone who’s actually thousands of miles away. He’s planning to install his company’s high-end system in his Silicon Valley home, provided he and his wife can agree on a spot for it.

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The Q1 earnings period could be a tough one for networking equipment companies; estimates for the likes of Cisco (CSCO) and Juniper (JNPR) in particular have continued to edge lower. William Blair analyst Jason Ader this morning weighed in with updates on those two stocks and a couple of other following a late March survey with 36 VARs in the U.S. and the U.K. Ader joined the chorus of estimate cutters; but he sees improvement on the horizon.

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Cisco Systems (CSCO) shares are headed lower this morning after Goldman Sachs analyst Simona Jankowski cut her rating on the stock to Neutral from Conviction Buy, noting that the stock had reached her $18 price target. Jankowski writes that she maintains a positive long-term view on the stock, “as Cisco’s execution and balance sheet position it well to benefit from favorable secular trends in IP networking.”

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Is the Open Cloud Manifesto doomed even before it’s officially announced?

Well, if not, it’s certainly been hampered. Why? The top three cloud platforms have decided not to participate. So it looks like IBM (IBM), Sun (JAVA), Cisco (CSCO) and a host of smaller companies will be on hand to represent the new Open Cloud Manifesto when it is announced on March 30. And some say Cisco’s support may be iffy. But who will not be among the list of supporters are Microsoft (MSFT), Amazon (AMZN) and Google (GOOG). How can you claim to have a true examination of what the future should hold for cloud computing without the active participation of even one of those three companies? And what about Salesforce.com (CRM), a cloud champion in its own right. Word is they aren’t in the group of supporters either.

As reported on the GigaOm site on March 27, Google will not be a part of the manifesto crowd.

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Now that President Obama has signed the $787 billion economic stimulus package into law, the real hard work begins: using that money to create jobs. If spent wisely, this package has a chance at fundamentally reforming the U.S. health-care system, making our economy energy efficient and providing Americans with the training and skills required to succeed in a 21st century global marketplace.

But the country can’t accomplish these goals unless it has the infrastructure to support them. That’s why the funding for broadband was so vital. Broadband is the ticket for entry to participate in the world economy. It is a fundamental technology upon which other things are built. It enables collaboration, innovation and operational excellence, and positions the U.S. to compete on a global basis.

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The numbers are startling; one technology IPO last quarter, only six in 2008. Is innovation dead? Did Google/Microsoft/Cisco consume all the promising start-ups? Did Sarbanes-Oxley render IPOs too hard and costly? Yes, if you believe columnists, conferences and collective wisdom.

They’re wrong. IPOs aren’t popular because they are perilous. Choosing extra risk now is like stocking up on peanut butter energy bars during a salmonella outbreak. The downside is ugly. New “unseasoned” issues are like new car models, rife with unknown quirks. We know their lineage and plans, but the future is mostly hope and speculation. Hindsight shows that newly public companies are prone to err when first under the marketplace spotlight.

The question isn’t “why aren’t investors buying IPOs now?” but rather “why do investors ever buy IPOs?” The answer is that institutional investors, the principal IPO buyers, exist to take calculated risks. If convinced potential reward overcompensates for added risk, fund managers will belly up to the IPO bar and order a double. Conversely, when offered safer, appealing choices, investors will skip the umbrella drinks and opt for the single malts. These days, risk reminds us of Jagermeister shots: something that used to be fun.

However, unless entrepreneurs now dream of Hondas–not Ferraris–and unless these “damn the torpedoes” folks checked their aspirations in the umbrella stand, the IPO market will be back.

The process of going public is tougher than it used to be but it’s still an entrepreneur’s crowning achievement. Need proof? Name four famous tech company founders. How about Sergey, Larry, Steve and Bill? Now name four tech legends who sold out to Cisco (CSCO), Microsoft (MSFT) or IBM (IBM). OK, name one.

IPOs are proof that ideas and hard work create recognizable value. No other exit affords founders both the glory and the independence. More tangible reasons to go include the start-up promise to employees; “Work long hours for low pay today, and tomorrow you too can afford a Tesla.” There’s no guarantee of success, but if it’s realized, there is an agreement that it will be shared by all. An IPO is the deliverable on that deal.

Secondly, acquisitive growth companies often prefer shopping with stock over cash, but agreeing on private-stock value is difficult. Public equity is a better currency because of its undeniable, third-party valuation. Finally, Silicon Valley’s history proves that yesterdays’ IPOs fund seed capital for tomorrow’s innovators.

A healthy economy needs a robust IPO market, begging the question: With so few of late, are we up the creek? To the contrary, five pointers suggest when we emerge from the current mess; our IPO market may be healthier than it has been in a decade.

1. Sarbanes Oxley is good for IPOs. According to Morgan Stanley Research, over a 20-year period, north of 60 percent of technology IPOs trade below their offer price. High on the list of reasons why newly public companies flounder is their failure to heed the wisdom of Paul Masson; they sell before their time.

The distractions are enormous and expensive. It’s genuinely difficult to lay the rails while driving a bullet train. Natural business challenges are compounded by the Sarbanes Oxley albatross. Fine-point accountability requirements force order on the chaos inherent in rapidly growing companies, but unquestionably slow the journey to market.

At an average small company cost of $3.0m, SOX implementation takes a major bite out of profits. However, while this expense initially reduces calculable company valuable for those using current earnings to set the IPO price, over time, accountability reduces corporate risk and therefore should increase returns. In fact, if a company can’t afford the expense and hasn’t endured the hardship of thoroughly documenting its systems, is it really ready for the teachers’ retirement fund, corporate pension plan or other public investors? It was easier to go public before SOX but, for investors or issuers, was it better?

2. The demise of investment banks is good for IPOs. Today, we lambast investment banks because they earned it. Formerly sure-footed firms ran full speed into a bog they didn’t understand. Those whom Tom Wolfe once christened “Masters of the Universe” and “BSDs” have morphed into LSWs (little shriveled walnuts).

How does this help the IPO market? In the heyday, technology IPOs were shepherded by boutique investment banks focused on, and economically aligned with emerging growth companies. Those banks didn’t invent, sell or swap CDOs or SIVs. Rather, in the 1990s, following the wisdom of the day, they sold out to diversified, theoretically better-capitalized, larger banks. Those acquiring banks emulated Audrey, the man-eating plant from “Little Shop of Horrors,” demanding ever larger revenues to sustain their mass, leaving new issuers who generate small fees with little IPOs, an acronym of their own; SOL.

Now, with large investment banks hanging with the pterodactyls, there’s an opportunity for boutiques to rise again, a turn that could be very good for the IPO market.

3. The implosion of hedge funds is good for IPOs. Hedge funds vary in size and style but until recently, the market movers who mattered were the fast-money behemoths. These players often care about IPOs only on day one. In a whiplash market, even longer term investors had little opportunity to amass measurable holdings of new issues. With the fast money players sidelined, patient “investment” (versus speculative) funds may again have time to develop confidence in management, a prerequisite for accumulating big positions in newly public stocks.

4. The new administration is good for IPOs: “It has not been the path for the faint-hearted, for those who prefer leisure over work, or seek only the pleasures of riches and fame. Rather, it has been the risk-takers, the doers, the makers of things…who have carried us up the long rugged path towards prosperity and freedom.”

Public recognition of the entrepreneurial spirit, and its critical role in our economy, by President Obama in his Inaugural Address. Enough said.

5. Constrained venture capital is good for IPOs. Comfortable start-ups, with logo-emblazoned, fleece-clad employees sometimes grow flabby. Conversely, start-ups scraping by to pay bills must focus on building and profitably selling products. While some genuinely need millions for development, others require only cheap computers and smart people willing to work like politicians during primary season. Eventually, outside investment fuels expansion, but examples from Apple (AAPL) to Intuit (INTU) to Google (GOOG) prove that, as the lottery once advertised, all it takes (at first) is a dollar (or a credit card) and a dream. Less venture money sloshing around today will likely mean fewer but stronger start-ups tomorrow.

It isn’t broken, please don’t “fix” it. Today’s IPO market is not healthy, but it is rational. Government’s role should be to insure that observant, active, on-the-ball regulators have the tools and backing to seek out and slam down financial cheats, thereby restoring confidence in the markets. If government can find a way to restrict extortionist lawsuits filed whenever a stock drops, that would help too. Otherwise, well-meaning administrators should stand clear.

When the markets settle and when the blue plate specials on blue chip securities abate, when the investment merits of an IPO are self-evident, a better and stronger market will be ready.