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3/19/2007
00:00 AM
Irwin Lazar
Irwin Lazar
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Looking a Bit Deeper At the Cisco-WebEx Deal

By now I’m sure everyone has heard about the acquisition of WebEx by Cisco announced on March 15th.  While the particulars are well known, I thought it would be useful to dive a bit deeper into some of the key collaboration and communication aspects of this announcement.

During a press and analyst call Cisco’s Charley Giancarlo noted two key aspects of this deal, the first being that it strengthens Cisco’s hand in the small-medium enterprise market, the second being that it gives Cisco another entry in the collaboration and social networking space.  It is this second point that is most intriguing.

Back in February Cisco acquired Five Across, which provides software that enterprises can use to establish social communities on their web site.  With the WebEx acquisition, Cisco further adds to their portfolio by acquiring WebEx’s WebOffice, a hosted service for group communications and collaboration.  Cisco also now owns WebEx AIM Pro, a business-class client for the AOL instant messaging network that features WebEx-based desktop sharing and also portal to Wall Street Source, a news feed service focused on the financial community.  How Cisco harmonizes these acquisitions into a unified communications and collaboration offering across all market sizes remains to be seen, but it is clear that Cisco is rapidly acquiring the pieces to enable it to deliver a comprehensive suite of collaboration and communication tools – both via on-premises applications as well as hosted services.

With regard to Cisco’s overall communication and collaboration strategy the acquisition fills two key gaps – the first is a hosted web conferencing and collaboration service that gives Cisco a strong competitive position against Microsoft and its Office Live service (as well as the underlying WebEx MediaTone network).  The second is that WebOffice can allow Cisco to directly compete with Microsoft SharePoint , which is quickly gaining market share in the shared workspace and portal space.

It’s pretty obvious that the intent of this deal was to better position Cisco against Microsoft in the communication and collaboration market, and perhaps as a way of checking Google as Google builds out its own suite of hosted services.  This deal certainly boosts Cisco’s hand, and strengthens its visibility outside of its core networking and telecommunications markets.  Tying WebEx and Five Across together, its obvious Cisco sees tremendous opportunity to move quickly into the collaboration applications space.

How this deal impacts Cisco’s budding relationship with IBM is still unclear.  Cisco announced last week integration of its UC client with Lotus Sametime, and an agreement to integrate MeetingPlace with Lotus Sametime Web Conferencing.  But with these moves Cisco becomes as much a competitor to IBM as a partner.  It remains to be seen how Cisco integrates WebEx into its partnership with IBM.  Perhaps Cisco can exploit the MediaTone network to offer integrated and hosted versions of Lotus platforms such as Notes?

One thing is certain, the last few weeks have brought about major change.  The collaboration and communications space is fast becoming a major battleground between industry heavyweights who see a tremendous opportunity to deliver tools and services to support an increasingly virtual workforce.  As I told a colleague yesterday, this has been a fun couple of weeks, but I suspect it is just the beginning.

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