Cisco Snags Acano for $700 Million To Enhance Video Conferencing Capability

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Cisco announced today it plans to buy video conferencing firm Acano for the widely reported price of $700 million.

The company, which is based in the UK, has developed video infrastructure and collaboration software. You’re probably thinking that Cisco already offers that same kind of service and you would be right. It bought WebEx in 2007 for $3.2 billion and has been positioning it as a video conferencing and collaboration platform ever since.

In addition, they launched a more modern alternative to WebEx they called Project Squared, last year. At the time they brought on Jonathan Rosenberg, the former CTO of Skype as their CTO of collaboration and let him loose to build a collaboration platform from the ground up.

Now, they’re buying this company and for a hefty sum. The question is why. Alan Pelz-Sharpe, an analyst at 451 Research who covers collaboration tools, says what Acano is offering is much more sophisticated than what Cisco has been providing and really fills out its video portfolio.

“I think in fairness, the Acano stuff is a step up over what Cisco may already have — this is serious enterprise hardware and software to beef up and expand video conferencing in firms,” Pelz-Sharpe told TechCrunch.

Writing on the Cisco company blog, Rob Salvagno, VP of corporate business development suggested that Acano enhances the company’s ability to make connections in a heterogeneous environment. In other words, it helps make video conferencing work, even when there are multiple vendor tools involved — and across multiple devices from mobile to a big screen in the board room.

“Acano’s portfolio includes video and audio bridging technology and gateways to enable customers to connect different collaboration solutions from disparate vendors across cloud and hybrid environments,” Salvagno wrote.

The company’s product portfolio includes a Skype for Business integration product along with tools for connecting over audio, video and via the web. The idea presumably is to bring a set of tools and technologies that enable Cisco to provide the video integration and infrastructure, even in customer settings where they are using rival Skype (which is owned by Microsoft).

“Acano will help Cisco expand the interoperability and scalability of our collaboration portfolio – allowing customers to connect from anywhere, from a browser on a mobile device to the corporate boardroom, and now scaling to easily connect thousands of users across an organization,” Salvagno wrote.

Pelz-Sharpe sees this against the backdrop of the unified communications market, and says Cisco really needed to enhance its offerings to stay competitive.

“The UC world as a whole though lucrative is seeing small start up’s nip at their heals in collaboration – but highly secure, and highly scalable products are still fairly thin on the ground. We will see more acquisitions by UC heavyweights [like Cisco] to embrace the move away from voice to video and chat,” he said.

Cisco has a lot experience buying companies and folding them into the big corporation, but the success of these deals always hinges on the ability to smoothly integrate the purchased company’s technology into the Cisco collaboration and video family.

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