This acquisition has been resilient in this recession as companies cut traveling expenses and adopt CSCO’s
Telepresence resulting in y-o-y growth of 70% in orders and 130% in revenues. The UCS debut has recently led IBM to jump ship to Juniper Networks (
JNPR) for possible future partnerships to resell JNPR’s equipment as part of its family of products.
New Markets
Cisco CEO John Chambers told BusinessWeek’s Aaron Ricadela that the company will likely be in 50 fresh markets within a year, mainly in adjacent markets to its core business so it can integrate its diverse product offerings.
“We’re moving into new (areas) with a speed nobody has ever attempted,” Cisco CEO John Chambers stated.
This includes in-house developments like the UCS, but also acquisitions such as Flip video recorder maker Pure Digital. In addition to its Linksys offerings and TV set-top boxes, Flip will help Cisco further penetrate the $50 billion global market for consumer electronics. They also bought out Tidal Software as an easy tuck-in company to enhance its data center business. Furthermore, CSCO has made a push into the energy business by offering smart grid solutions that take advantage of secure IP-infrastructure to reduce energy storage, transmission and distribution costs for a more sustainable environment. Cisco has struck an “alliance” to provide Clearwire’s wireless IP infrastructure along with plans to build new mobile WiMax supporting devices. The Silicon Valley company has also made moves in virtual healthcare, sports and entertainment (with its StadiumVision) and much more.
Cisco CEO John Chambers
With $33 billion in its wallet, second in the S&P 500 to Exxon Mobil (XOM), Cisco is gearing up for acqusitions. This comes as no surprise as CSCO has acquired 175 business since 1993. However, of the $33 billion in cash, the majority of it (approximately $26 billion) remains offshore and deferred from income taxes indefinitely until the profits are repatriated. The Obama Administration aims to change this rule (or loophole). Even with that controversy, Cisco still stands strong in the M&A world:
“First, the exciting part about today’s market is just about everybody’s for sale.
