Cisco Systems Inc.
(
CSCO
) announced its plan to buy privately held ClearAccess for an
undisclosed amount. The transaction is expected to be completed by
the fourth quarter of fiscal 2012, pending customary closing
conditions.
Vancouver-based ClearAccess provides both hardware and software
for Internet service providers to manage increasingly complex
networks for homes and mobile devices.
The newly acquired products from the ClearAccess acquisition
include TR-069-based software that helps service providers to
manage residential and mobile devices. Cisco intends to blend
TR-069-based product with Cisco Prime, its network management
software portfolio. The acquisition will improve Cisco's software
capabilities for service providers, thereby improving operational
efficiencies and customer experiences.
However, the hardware portion of the ClearAccess, called Smart
RG Gateways, will remain an independent company called SmartRG
Inc.
Cisco is eyeing to capture a large share in the expected revenue
to be generated by worldwide internet traffic within the next few
years. The network giant assessed that contribution from video
content transfer would be roughly 90.0% of the total internet
traffic revenue. ClearAccess' cloud and video services will allow
Cisco to capitalize the opportuinity. Earlier this month, Cisco
also acquired London-based video communications company NDS for $4
billion to bolster its video strategy.
Cisco Systems is a leading provider of IP-based networking and
other products. Although Cisco is taking steps to lower its cost
structure by reducing headcount, it is not ignoring growth
opportunities.
Cisco is no doubt the networking leader, but competitors like
Juniper Networks
(
JNPR
),
Hewlett Packard Company
(
HPQ
) and
F5 Networks
(
FFIV
) are gradually picking up market share.
The Zacks Rank on Cisco shares is #2, implying a Buy
recommendation over the next 1-3 months.
CISCO SYSTEMS (
CSCO
): Free Stock Analysis Report
F5 NETWORKS INC (
FFIV
): Free Stock Analysis Report
HEWLETT PACKARD (
HPQ
): Free Stock Analysis Report
JUNIPER NETWRKS (
JNPR
): Free Stock Analysis Report
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