"I doubt the pendulum will swing back toward hardware like the switch fabrics of today. Once the margin starts slipping in a particular product category, it doesn't tend to recover later. If anything, I expect it to move further toward software. Switch ASICs right now have a lot of knowledge about how packets are supposed to be routed, and I expect some of this to be removed in favor of software configuration. The ASIC might consist of a set of lookup tables, CAMs, and rewrite engines, and allow the software to supply sets of instructions to stitch those resources together. I suspect the next opportunity to move the momentum back toward hardware design would be when we have a disruptive change. For example if pure optical switching ever becomes a commercial reality, I suspect it will come in at much higher margins." - DGentry