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Service Contracts and Warranties on Network Equipment


Understanding why maintaining service contracts on network equipment is mandatory

Question posed by an IT manager reader:


I was talking with CFO and COO about the switch warranties renewals. They would like to have the replacement warranty for the core network switches.  Then we will keep and extra 24 port switch on standby in case one of the other stack switches break. It is cheaper to have an extra switch on hand, than paying $3000 a year for warranties on 11 switches. Next year the number switches will grow, so the COO wants to keep a switch on standby instead of spending so much money on warranties. Please let me know what you think.


Response by: Felicia

Thank you for your question.

Discontinuing warranties on switches is not an option in my opinion. Obviously, you can do what you want to do, but my role is to inform you of the significant risk and adverse business impact of that approach.

You will not only not have support, but will not have access to firmware upgrades for those switches without maintaining active support contracts on them.

In most cases, a consultant will not touch the switches because they will not be able to contact the manufacturer for escalation support.

This is not just about hardware warranty.

What you find very prevalent in the Cisco world is that consultants will not even touch the equipment without there being a valid support contract on the equipment. Why? Because if they touch it and there is no manufacturer escalation support, then they take the liability of bringing your network down with no ability to escalate the issue to manufacturer support to resolve the issue. I am not aware of any consulting firms that will accept that liability.

In a lot of circumstances, a problem is occurring where the fix for it is to install the latest firmware for the switch. How can that be accomplished if the firmware update for the switch is not availble to be installed because the switch is not under active support contract?

I had a school client some years ago that had purchased a bunch of Cisco switches, and ASA, gateway wireless controller, and a $100,000 phone system from CDW. I thought it was ridiculous because there was no plan for them to have a budget to pay the Cisco support contracts annually on the equipment.

The cost for the annual support contracts for this equipment was so much that they could not afford to keep it up.

However, as a result, their network degraded to the point of unusability and no Cisco certified consultants would touch any of the equipment without a valid support contract being on the equipment.

When they inquired with Cisco to renew the support contracts, Cisco mandated that they pay reinstatement fees that were the equivalent of if they had always maintained the support contracts. As a result, the school decided to rip out the entire Cisco infrastructure and replace it with switches and security appliances provided by QPC.

When you don’t have support for something, it can become and unstable brick.


We have recently experienced why it is crucial to stay up to date on firmware. Not keeping equipment under warranty, not keeping the equipment updated, and not installing firmware updates in a timely fashion is one of the reasons why your former network infrastructure degraded to such a horrible degree under the former IT manager’s tenure. By discontinuing the support contracts, it would be the equivalent of not maintaining the value of the investment the organization has made into the new solution.

An extra 24 port switch on standby is not a viable strategy because it is not a direct replacement for the various switch models.

And that still does not address the firmware updates or ability to escalate issues to manufacturer support.

A single outage would cost your organization far more than $3000. And again, most consultants will not touch equipment that is not under support contract with the manufacturer. So if the consultant won't touch it, and you can't contact the manufacturer for support without an active contract, then you have broken bricks.

There is no switch manufacturer that makes business quality switches while offering a lifetime hardware warranty and unlimited access to firmware updates for free. One of the many advantages with Extreme switches is that the annual NBD AHR support contract is significantly less than what it would be with Cisco, for instance. A 1-year support contract for a Cisco gateway wireless controller alone is >$1500. A typical Extreme switch 1-year support contract is ~$250 or less.

I believe you are now fully informed on the topic. Let me know if you feel otherwise.

Response by IT Manager

Thank you for helping us understand that this is about more than a hardware warranty, and that a single spare switch is not a viable hardware failure risk mitigation strategy for many different switch models.