Blogs

RedMonk

Skip to content

Three Things That People Get Wrong About Cisco’s Jabber Acquisition

Another week, another RedMonk client acquired. This time around it was Jabber, acquired by Cisco. In doing so, they follow in the footsteps of other RedMonk Graduates like Covalent (SpringSource), IONA (Progress), MySQL (Sun), OpenedHand (Intel), Scalix (Xandros) and Sleepycat (Oracle). 

It is true, what they say: work with RedMonk, and you’ll get acquired.

Besides failing to note that all important detail, most of the reaction pieces I’ve seen to the news missed a detail or two along the way. In my opinion, anyway. So this quick note is intended to address the three things that I think need to be understood about the acquisition of Jabber, Inc.

Before I continue, let me re-disclose the fact that Jabber’s a customer of ours, and also note the fact that several friends of mine work over at the Denver office, which is five blocks from my loft. So as always, read into that what you will.

Continuing, the three things that I believe people are getting wrong about the deal.

  1. It’s Not About the Collaboration:
    This is said somewhat tongue-in-cheek, because of course it is about the collaboration. As Ashlee – who’s gone big time on us, and is now writing for the New York Times, please note – writes, the Jabber acquisition is specifically intended to complement the WebEx platform:
    Cisco will use the Jabber technology to complement the WebEx platform, said Charles Carmel, vice president of corporate development for Cisco. With its increasingly comprehensive array of collaboration products, Cisco now competes head-to-head against the likes of Microsoft, I.B.M., Yahoo and Google, which are all courting the same market.

    But that’s not the interesting part of the deal. At least as far as I’m concerned.

    Certainly, Jabber’s XMPP assets could mean good things for WebEx (if they’re able to improve WebEx’s non-Windows experience even slightly, I’ll stop writing things like this – I promise). Which is important, in a market that could be poised for substantial growth, given that business travel could be significantly curtailed in the wake of the financial crisis and skyrocketing costs of fuel.

    Still, when I think of XMPP, I’m thinking bigger than IM. Bigger, even, than collaboration. I’m thinking about Sam’s long bets, Kellan and Rabble’s presentation, and AMQ vs XMPP. As you might have guessed from the interview I did with ex-Jabber CTO and new Cisco employee Joe Hildebrand a few months back.

    When I think about a networking company, then, made famous for its role in supplying the plumbing for the internet  (even The Simpsons knows Cisco) buying the company with the most expertise in a highly scalable and extensible messaging and presence protocol, I tend to think there might be more at work than is obvious on a first pass. Given his reading list, it seems reasonable to speculate that Bill might agree.

  2. It’s Not About Open Source:
    A number of commentators have speculated that this is Cisco making a bold statement in open source, which is a tough position to take given the fact that Jabber is not an open source company. Emphatically so. I don’t mean to imply that they’ve never participated in open source, nor that their employees do not deeply understand and appreciate the role of open source as developers and committers. Because neither of those statements is accurate.

    But Jabber, Inc’s core products are not open source; indeed, in many instances, their primary competition are open source implementations.

    Having said that, however, it is interesting to speculate on whether or not this deal could eventually be about open source. One of the difficulties for Jabber was that as a small company competing with industry giants like IBM and Microsoft, the revenue pressures were intense. Not that Cisco doesn’t require revenue, but they are unquestionably less cash pressured than a small firm like Jabber.

  3. It’s The Company Being Acquired, Not the Protocol:
    A few Jabber employees have already tackled this subject, but it’s worth emphasizing. As Dave has discussed, the tendency to use Jabber to refer at once to Jabber, Inc the company and the XMPP protocol has led to some confusion. For those that have more detailed questions on the future and independence of said protocol, Saint Peter has you covered (in a Q&A, no less).

I, for one, welcome our new XMPP overlords. Or, less glibly, I’m intrigued to see what Cisco does with its newfound XMPP abilities.

Cisco, like a very few industry players we could talk about, does acquisitions very well. They know who they want, and they know how to integrate them should they acquire them.  Probably in part because they have a lot of practice.

Categories: M&A Announcements, Network, Open Standards.