Cisco Systems is one of the original partners in the $168 million computing center planned for downtown.
HOLYOKE – Worldwide internet equipment maker Cisco Systems Inc. remains committed as a partner in the planned $168 million high performance computing center here despite recent problems, officials said.
Cisco has prompted concerns among business analysts since November. Its stock value fell and profit margins slumped as the company underwent a refocus and shut down the video camera line it bought two years earlier.
Richard M. Power, Cisco spokesman for New England, declined to discuss issues regarding the company in detail in an email Wednesday but wrote that Cisco’s dedication to the computing center is unchanged.
“Cisco is fully committed to the Green High Performance Computing Center initiative in Holyoke. We are very excited about the project’s recent and upcoming milestones and we look forward to continued collaboration with all of the project’s partners to ensure its ultimate success,” Power wrote.
State and city officials said they have seen nothing to signal that Cisco’s participation in the computing center might change, despite the company’s recent problems.
“It’s not going to have any kind of impact on their employees in Boston and it’s not going to have an impact on their involvement in this project. It’s not going to have an impact, as far as I know,” said Jeffrey Brancato, associate vice president for economic development with the University of Massachusetts.
Cisco representatives have been involved right along in the frequent conference-call and in-person meetings on the computing center, said Kathleen G. Anderson, director of the city Office of Planning and Development.
“We have had no indication that there have been any changes,” Anderson said.
The California-based Cisco sells telecommunications equipment and routers for directing internet traffic.
Cisco has been part of the partnership since Gov. Deval L. Patrick announced in June 2009 that the center would be built here.
The computing center will occupy the former Mastex Industries facility on Bigelow Street downtown overlooking the first level canal. Demolition on the site is scheduled to begin within weeks, officials said.
The research hub will consist of computers doing research in hours and days that used to take weeks and months into areas as varied as climate change, causes of illnesses and the arts.
The center is being built here because of the available energy at the hydroelectric dam and canals owned and operated by the Holyoke Gas and Electric Department.
Cisco’s stock has fallen 35 per cent over the past 12 months as the company undergoes a shake-up to refocus on its most important markets, The Financial Times reported April 6.
The Financial Times reported Feb. 10 Cisco profit margins had slumped and appeared to confirm analysts’ concerns that the company was expanding into too many new products, particularly in the consumer market.
This month, Cisco announced it was closing the Flip video camera division it bought for $590 million in 2009. The business was considered a drag on profits, The New York Times reported April 12.
The New York Times quoted an analyst who said the Flip camera line probably recorded about $400 million in annual revenue compared with about $40 billion for Cisco over all.
Joining Cisco as partners in developing the computing center are the University of Massachusetts, Massachusetts Institute of Technology, Harvard University, Boston University, Northeastern University, and EMC Corp., of Hopkinton, an information storage, back-up and recovery firm.