Cisco Systems on Friday announced plans to acquire presence information and messaging software developer Jabber. Financial terms were not disclosed.
With Jabber in its portfolio, Cisco can embed presence information and messaging services in the network. The acquisition will also offer Cisco users aggregation capabilities through both on-premise and on-demand solutions and across multiple platforms, including Cisco WebEx Connect and Cisco Unified Communications.
"Enterprise organizations want an extensible presence and messaging platform that can integrate with business process applications and easily adapt to their changing needs," said Doug Dennerline, Cisco senior vice president of the collaboration software group. "Our intention is to be the interoperability benchmark in the collaboration space."
Presence: The Foundation
Jabber's technology can gather presence information across different devices, users and applications. With Jabber, users can also collaborate across various presence systems, including Microsoft Office Communications Server, IBM Sametime, AOL AIM, Google and Yahoo.
Cisco said the Jabber acquisition demonstrates its "build, buy and partner" strategy to move quickly into new markets and capture key market transitions. In addition to internal software innovations, Cisco is known for making investments in small start-up firms and acquiring companies to support its software strategy. Indeed, Cisco's latest string of purchases includes WebEx, IronPort, Securent and PostPath.
According to Yankee Group analyst Zeus Kerravala, Cisco has been looking to grow its collaboration business significantly. "Collaboration business growth has become a main focus area for Cisco," he said. "And the Jabber acquisition gives them a much better presence offering."
Although Cisco historically has positioned Voice over IP, or VoIP, as the foundation of unified communications and collaboration, Kerravala believes presence is the bedrock. Presence, he explained, adds some intelligence to collaboration.
"I think presence is the most important piece of building business processes around collaboration," Kerravala said. "So this acquisition gives Cisco a much better product than they had before. It also makes Cisco more competitive with Microsoft."
Cash-Rich Cisco Could Strike Again
When the acquisition is completed in the first half of fiscal 2009, Cisco said Jabber
employees will become part of the Cisco Collaboration Software Group. CSG is part of the recently established software group, which includes Cisco's major software businesses. The IOS network operating system, network and service management, unified communications solutions, policy management, and SaaS offerings are in this mix.
In a down economy, the haves and have-nots will begin to separate themselves, Kerravala said. Company valuations are low, putting the cash-rich Cisco in a strong position.
"While other companies are retrenching -- we saw Nortel's earnings yesterday that they are looking to shed its Metro Ethernet business -- Cisco because of its cash position could add to its portfolio pretty cheap," Kerravala said. "I imagine the price for Jabber six months from now would be a lot more than the price for Jabber today."