Silicon Valley veteran Judy Estrin has seen it all.

From her roots in the networking industry as a co-founder of Bridge Communications in 1981, Estrin's career has stretched across many of the most significant trends in the high-technology industry. From the growth of small-business networks, to alternate computing devices, to multimedia, Estrin, 46, has along with husband Bill Carrico, 50, pegged opportunities and hot technologies at their earliest stages.

When her last venture, Precept Software, was purchased by industry behemoth Cisco Systems in 1998, that company's chief executive, John Chambers, jokingly said he bought the company as much for Estrin's expertise as for the technology. Now, after a two-year stint as Cisco's chief technology officer, Estrin has returned to her start-up roots, founding a Menlo Park, Calif.-based company called Packet Design--made up of about 20 researchers and developers at the moment. The company expects to make public the first fruits of its work in the first half of next year.

Packet Design started with three ideas but has expanded its plan to incorporate five. The company will turn those technology concepts into actual companies, with their own executive staffs. With that work, plus Estrin's continued presence on the board of directors of Sun Microsystems, Disney and Federal Express, her plate, as usual, seems to be full.

With the telecommunications market in the midst of a huge shake up, Cisco having one of its more challenging years with a depressed stock, and a dot-com depression settling on Silicon Valley, Estrin took some time to tell CNET News.com what she's been up to, where the industry is headed, and how she views Cisco.

CNET News.com: There's been a lot of publicity surrounding a shakeup in the communications industry. What should we make of it?
Estrin: This is characteristic of broad-reaching change that we knew the Internet was going to create. My sense is we almost went too fast into some things and that's why it's shaking up a little harder. We went so quickly into buying into this whole move into the New World and convergence that I think some companies got ahead of themselves. There were concepts that are good concepts that maybe we hadn't solved all the problems on.

If you look at the last two years, there were a lot of people moving very, very fast and, again, some of them were making the assumption that the capital markets would always be easy. It has to absorb all this change and while its absorbing it, it may look like complete chaos, and it may emerge from it with a new set of leaders. Some of them will be Old World companies and some of them will be New World companies. I don't think it's the case that just because someone was a leader in the Old World that they can't emerge from this, but I also don't think all of them will.

So what is this shift in your career about, from a high-ranking executive at one of the most successful large companies in the world to the chief executive at a start-up that spins out companies?
I had done some thinking about how to solve some of the Internet's problems within a company like Cisco and came to a conclusion that these areas needed the type of focus that a standalone company could provide. Bill and I thought about what we wanted to do and said, "OK, how do we create an organization that can focus on technology with a longer-term perspective than most of the start-ups out there today?" Start-ups used to go for five years before they went public, now they go for two years before they go public. So they do a lot of innovation the first two years, but then they get in this short-term cycle.

One of the problems with looking long term is you're not grounded. We wanted to be somewhere in between. We wanted to focus on some problems with a little bit longer-term view but still be practical and applied.

So the first premise is you don't go public, because being public is what caused that (short-term thinking). And the second thing is we didn't want to get bought. So what we constructed was a company that worked on technology and spun out companies to make products based on that technology. Then those companies can go public and Packet Design employees can benefit and have a return on equity, and those companies can get bought. It kind of allowed us to be a perpetual start-up.