Cisco has once again made a strong push in the collaboration and conferencing space by showing its intention to acquire Tandberg for a cash offer estimated at about $3 bn.
This acquisition will not only help Cisco to extend its high-definition video conferencing solution with the help of broad portfolio of Tandberg's offerings but this deal is another milestone in this year's merger and acquisition growth story. Many believe that Tandberg is Cisco's most important acquisition since Webex.
One of the most important deals this year, Cisco's acquisition of Tandberg will definitely change the collaboration and conferencing landscape. The company which is likely to feel the jitters is Polycom, leader in the conferencing solutions space in the country. Polycom was already feeling the heat from Cisco's aggressive marketing strategy last year since Cisco recorded a growth of more than 300% in this space, according to Voice&Data estimates. Cisco-Tandberg deal will have far reaching ramifications for Polycom.
The deal might help Polycom in short term since there is likely to be uncertainty in the market. However, Polycom will have to come up with an aggressive marketing strategy to defend its leadership position in the market.
In the past two years, Cisco has made some very interesting acquisition to strengthen its play in collaboration and Unified Communication space. Recently Cisco also announced that it would be acquiring $2.9 bn.
According to Frost&Sullivan report, “Against the backdrop of a recessionary environment, both large and small businesses are expected to increase their spending on collaboration technologies to save costs and increased productivity. This has led big names in the IT industry such as Microsoft and Google to increase their reach in this market through consolidation and acquisitions, targeting both the business and consumer side. The planned acquisition of Tandberg by Cisco is the most recent example in this trend that is expected to continue as the market matures in the coming years.”
The report further says, “This well-timed strategic moves position Cisco at the forefront of having an end to end unified communications and collaboration offering and further strengthening its portfolio of solutions in conferencing and collaboration. The telepresence market segment as a high end video conferencing solution received a huge boost with the marketing push of primarily Cisco and HP.”
Cisco and Tandberg are already well-established players in the audio-video conferencing space. With this acquisition, Tandberg's video endpoints and network infrastructure solutions will be integrated into Cisco's collaboration architecture, enabling multi-vendor interoperability and ease of use across the full product portfolio-from desktop to multi-screen telepresence. This interoperability will benefit Cisco's customers, partners and competitors by accelerating customer interest in video collaboration globally.
Commenting on the acquisition, John Chamber, chairman & CEO, Cisco said, “Cisco and Tandberg have remarkably similar culture and a shared vision to change the way the world works through collaboration and video communications technologies. Collaboration is a $34 bn market and is growing rapidly- enabled by networked Web 2.0 technologies. This acquisition showcases Cisco's financial strength and ability to quickly capture key market transitions for growth.”
arpitap@cybermedia.co.in
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