17 Apr 2007, 11:59PM PT
17 Apr 2007, 12:00AM PT
Closed: 17 Apr 2007, 11:59PM PT
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Explain Cisco's Acquisitions of Social Networking Technology by Jason Wood
Friday, April 6th, 2007 @ 7:53PM
First, let's acknowledge the two important points:
1) Social networking within the enterprise is nascent
2) Cisco throws off $400-$600mm in free cash flow PER MONTH
If one combines the "social software" plays Cisco made recently, they are in the truest sense a drop in the proverbial bucket. A far more interesting question is what Cisco has planned for Webex; which is arguably one of the most successful SaaS vendors in the world. The Webex deal is the 2nd largest acquisition Cisco has made this decade [2nd to Scientific Atlanta].
Getting back to the specific question at hand; Cisco has aggressively moved itself closer to the end user for years. Whether it was branching further out of the core of the network to buying Linksys so they could get a place within the home and small offices, to the purchase of Scientific Atlanta which puts Cisco in tens of millions of living rooms. John Chambers and his team are SMART people. Their track record is without equal and clearly they realize the POTENTIAL power of social networking.
Let's not confuse these purchases as being some grand plan for Cisco. It's standard fare for Cisco to make small bets on areas of potential interest. These moves are no more, or less significant than Cisco's decision to open up a venture capital group in Russia this week. They are call options on future opportunities.
Explain Cisco's Acquisitions of Social Networking Technology by Mathew Ingram
Sunday, April 8th, 2007 @ 5:57PM
Explain Cisco's Acquisitions of Social Networking Technology by Haydn Shaughnessy
Wednesday, April 11th, 2007 @ 2:03AM
Explain Cisco's Acquisitions of Social Networking Technology by Vinaya HS
Monday, April 16th, 2007 @ 2:36AM
Cisco’s Media Solutions Group (CMSG) was put together with one objective – to provide an infrastructure platform designed to help media-content owners enhance the content and entertainment experience for consumers. Key in this objective are two terms: “infrastructure platform” and “content and entertainment experience.” Gluing them together is the fact that, in this increasingly networked world, “content and entertainment experience” is almost always delivered over a network pipe and Cisco has always been state-of-the-art in providing networking infrastructure.
What Cisco was missing in the above puzzle was the software infrastructure to deliver that “content and entertainment experience.” That too has now been solved with the acquisition of Five Across and the platform behind Tribe.net. It obviously makes sense to purchase a proven (and state-of-the-art) software asset rather than to build it from scratch in house (think about the time saved in getting the solution out in the hyper-competitive market).
Ning’s Marc Andreessen is quoted as saying "The idea that Cisco is going to be a force in social networking is about as plausible as Ning being a force in optical switches." One couldn’t be more wrong. Cisco’s strategy is definitely not to be a force in social networking. If that was the case, it would have thrown its cash at MySpace. Cisco purchased select assets – read, proprietary software infrastructure – of privately-held Utah Street Networks, Inc., the operator of the social networking site Tribe.net. The deal does NOT include the Tribe.net site, which will remain completely independent of Cisco.
It’s the same with Five Across. Five Across’ Connect Community Builder platform is the leading social networking and online community solution for consumer product and services companies looking to add functionality to an existing online presence. It is a rapid-deploy web publishing platform that enables organizations to promote and monetize user-generated content, including video, photos and audio without compromising overall site performance. What’s more the platform is designed for scalability.
Cisco now has both the plug and the socket.
Cisco’s Media Solutions Group can now offer businesses a one-stop package (through state-of-the-art hardware and software that seamlessly scale with business requirements) to visibly enhance their web presence through site-specific user communities. Potential customers include media companies, sports leagues, affinity groups, and any organization wishing to increase its interaction with its online constituency.
Cisco’s Media Solutions Group is doing exactly what its name says – offering media solutions.
Reference:
Cisco Media Solutions Group (CMSG)
http://www.cisco.com/web/strategy/media/index.html
Five Across
http://www.fiveacross.com/product/index.html
Cisco Completes Purchase of Selected Assets of Utah Street Networks, Inc.
http://newsroom.cisco.com/dlls/2007/corp_030507.html?sid=BAC-JsSynd
Cisco Announces Agreement to Acquire Five Across
http://newsroom.cisco.com/dlls/2007/corp_020807.html?sid=BAC-JsSyndExplain Cisco's Acquisitions of Social Networking Technology by Teck Chia
Tuesday, April 17th, 2007 @ 1:05AM
Like all maturing industries, Cisco is facing commoditization of traditional network equipment and services. Scrappy startups are providing cheaper and functionally similar solutions on increasingly powerful commodity hardware, chipset and/or open-source OS like Linux. Open-source pure software solutions like Vyatta are maturing quickly, enabling customers to deploy networking services on their own commodity hardware. Cisco is also facing a major competitor Huawei in China, a big growth market for Cisco (and most any company, for that matter).
Cisco recognizes these trends and have probably started projecting very far ahead to see what areas they can extend into to protect their business. Cisco is familiar with commoditization of the network stack, starting from the lower levels (eg. pure routing power) and gradually moving up to higher level services (eg. traffic shaping, xml routing, sophisticated network security). Customers expect more and more services built into a single box at lower and lower prices. Cisco is now pushing do-it-all power/space-efficient chasis-based equipment that comes built with a whole slew of features and future-proofed via firmware upgrades and expansion cards.
Cisco has been able to keep up by aggressive acquiring startups. This strategy has worked well for them not only to quickly add competitive features, but to add to their talent pool. However, Cisco has normally acquired startups with products that are not too much of a mind-stretch with regards to integrating them into existing product lines or into an appliance box you can plug into a network.
FiveAcross and (especially) Tribe.net seem to be as far away from Cisco's space as one can get in terms of synergy and customer needs. Here are some postulations as to why Cisco acquired these two companies: