Cisco Expands Cloud IoT Services with $610M Viptela Acquisition
Networking giant Cisco is reinforcing its efforts to expand its presence in cloud-delivered and Internet of Things services by acquiring networking startup Viptela, a cloud-based software-defined wide area network (SD-WAN) company. Cisco announced the acquisition yesterday, saying the move will help build on its existing SD-WAN portfolio while providing clients with more functionality.
The $610 million deal is expected to close sometime in the second half of this year, with Viptela's team becoming part of Cisco's enterprise routing unit, which is itself part of Cisco’s larger network and security business division.
"Viptela's technology is cloud-first, with a focus on simplicity and ease of deployment while simultaneously providing a rich set of capabilities and scale. These principles are what today's customers demand," said Scott Harrell, senior vice president of product management for the Cisco enterprise networking group. "With Viptela and Cisco, we will be able to deliver a comprehensive portfolio of comprehensive on-premises, hybrid, and cloud-based SD-WAN solutions."
Viptela's SD-WAN service is geared toward simplifying the work of managing dispersed enterprise networks. The company said that helps companies reduce the costs associated with network management while also providing them with greater flexibility and faster response times.
As for Cisco, the company said the acquisition fits neatly into its efforts to offer more software-defined WAN support for enterprises that may be struggling with adding many more mobile devices or IoT devices to their corporate networks than they had originally anticipated. While the deal helps build out Cisco's WAN services, particularly its cloud-delivered offerings, the acquisition also furthers the company's strategy of transitioning its business toward more software-based services, which it said will provide more predictable, recurring revenues.
Building Out Cloud Services
The Viptela deal is only the latest move by Cisco as it aggressively seeks to make a name for itself as a provider of cloud-based and IoT services. That has resulted in a slew of acquisitions, more than 19 since 2015.
While the Viptela buy will likely provide Cisco's enterprise network services some nice new features, the deal is not even one of the biggest moves that the company has made this year. The acquisition of cloud company AppDynamics for $3.7 billion right before that company was set to go public earlier this year dwarfs this announcement. And last year, Cisco acquired cloud-based IoT platform Jasper Technologies for $1.4 billion.
Just last week, Cisco announced the launch of a new enterprise service for the Jasper platform to help companies manage and connect with their employees’ mobile devices. And in March, the company announced that it was joining the Three Group, which manages a global portfolio of high-speed mobile networks, to provide IoT services to enterprise clients starting in the second half of the year.