Cisco Systems Inc.
) recently completed its acquisition of privately-held Meraki
Inc. for $1.2 billion in cash. The deal was announced last
California-based Meraki offers cloud networking solutions for
medium-sized businesses, which help to manage their corporate
network using the Internet. These solutions include Wi-Fi,
switching, security and mobile device management that is
centrally managed from the cloud. Meraki also has offices in New
York, London and Mexico.
Meraki will now become a new division within the company known
as the Cloud Networking Group. The integration of Meraki's Wi-Fi
and cloud-networking solutions into Cisco's portfolio will help
the latter to continue with its strategy of increasing its
software-centric solutions to streamline network management and
empower customer workforces at remote locations.
The acquisition will also expand Cisco's lineup of products
for mid-sized customers. It will strengthen the company's Unified
Access platform, a product which is aimed at simplifying IT
operations by integrating wired and wireless networks and their
Cisco is keen to expand on the cloud computing front, which is
viewed by many technology firms as a key area for future growth.
In fact, the whole computer-networking industry is undergoing a
shift toward software-centric solutions that eliminate the need
for expensive hardware and provide administrators remote access
Cloud computing allows users to store and process big data at
remote data centers instead of their own computers. On a positive
note, Gartner expects the cloud services market to grow more than
three times by 2015 to $177.0 billion.
According to market research firm IDC, spending on public
cloud services is expected to touch $100.0 billion by 2016. This
tremendous growth potential and the rapid adoption of cloud
technologies will particularly help Cisco's cloud infrastructure
solutions portfolio in the long run.
Cisco Systems is a leading provider of IP-based networking and
other products. We believe that the acquisition will broaden
Cisco's customer base and network offerings, providing the
company with a significant competitive edge over its peers,
Juniper Networks, Inc
F5 Networks, Inc
), which have been picking up market share.
Currently, Cisco carries a Zacks #2 Rank (Buy)
CISCO SYSTEMS (CSCO): Free Stock Analysis
F5 NETWORKS INC (FFIV): Free Stock Analysis
HEWLETT PACKARD (HPQ): Free Stock Analysis
JUNIPER NETWRKS (JNPR): Free Stock Analysis
To read this article on Zacks.com click here.