Initially, Cisco sees the Nexus switches at the core of data centers that still use separate networks for processing and storage. But as FCoE emerges in storage systems, the Nexus could become the single connectivity platform, Ullal said. Its switching fabric is designed to be lossless, unlike a standard Ethernet system, which tolerates dropped packets, said Tom Edsall, senior vice president and CTO of the data center group. The platform also has built-in security features, including wire-speed encryption and authentication capability for each port.

At the heart of the platform is a new, virtualized operating system, NX OS. As with server virtualization, NX OS can turn a Nexus switch into multiple logical switches running totally different processes, Ullal said . For example, one logical switch could handle storage and be managed by storage specialists, while the other links servers and is run by a different staff. A third could be a test platform. All would use a single switching fabric and set of redundant power supplies, which provides benefits in performance, economies of scale and resiliency, she said. This virtualized architecture eventually will trickle down to other Cisco product lines, according to Ullal.

Cisco also has automated some aspects of management with the Nexus line, drawing on best practices it learned partly from its customers, Edsall said. The system is designed to monitor and heal itself in many cases.

The network's role in data centers is growing as computing and storage are combined and shared, according to industry analysts. It's now the "orchestrator" of the data center, Zeus Kerravala of Yankee Group said. Cisco is the only vendor with both the networking and the computing experience to fulfill that role, he believes. But though many managers of data centers want to see total virtualization of the data center, which could boost efficiency, they aren't yet ready for it.

"We're just entering the very early stages of the virtual data center," Kerravala said. "This is probably at least two years away."

Cisco is best positioned to build the core of data centers because the network touches everything in it, according to Ullal, Edsall, and other executives.

"For Cisco, it's very critical that this platform be a launching pad to go further up the IT stack," said IDC's Cindy Borovick. However, taking control of data centers won't be a walk in the park, she cautioned.

"Cisco's in a very strong position, but there are other very large suppliers that recognize how important the data center is and are willing to invest the R&D dollars," Borovick said, citing IBM and Sun Microsystems. To Cisco's peril, data center administrators are more than willing to buy the best of many vendors rather than standardize on one, because they control the "crown jewels" of the enterprise, she said.