Video Growth Drives Two Acquisitions

Carl Weinschenk
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What to Look for in a Videoconferencing System

Key features to consider before purchasing a videoconferencing system.

Two significant and conceptually related acquisitions were announced this week.

On March 15, Cisco said it purchased the NDS Group Ltd., a British company, for $5 billion (or, as the CRN story phrases it, "a whopping" $5 billion). The story suggests that the acquisition - Cisco's largest, according to the story, since its purchase of cable equipment vendor Scientific-Atlanta for $6.9 billion in 2005 - will aid its Videoscape initiative:

According to Cisco, NDS uses a software platform and various services to enable subscribers to view, search and navigate digital content from various devices at any location.

The other deal, also announced on Thursday, was Avaya's purchase of Radvision for $230 million. The eWeek story says that the deal was rumored for a long time and thought to be imminent in recent days. The rationale for Avaya was clear, according to the story:

With Radvision and its telepresence and video conferencing products in hand, Avaya will now be able to offer an integrated and open UC offering that features video collaboration capabilities for everything from the conference room to mobile devices like smartphones and tablets, according to officials. It also will put Avaya into even more direct competition with the likes of Cisco Systems, both in unified communications and networking.

The story provides much more detail. There is a specific Cisco link in the piece. Radivision, the story says, struggled since Cisco bought Tandberg in 2010.

 


The relationship between the deals is superficial but not insignificant. Of course, both involve Cisco: One was made by the company and the other as a competitive hedge against it. The other connection is that both deal with video. Of course, almost everything linked to broadband that makes news is video-based, since it is the type of data that is most responsible for the exponential growth of traffic during the past half decade.

Cisco is a video trafficking giant. It's no accident that it produces the Visual Networking Index, a recurring study of network usage growth. The numbers change with every version - and usually get more and more esoteric - but the theme remains the same: There is an unbelievable amount of data being sent, and a lot of it is video. Whether it is entertainment video or unified communications doesn't matter at the core network "plumbing" level.

Though it is most often thought of as connected to its entertainment initiatives, it is not unreasonable to think that NDS technology will be used to support Cisco's unified communications business. The description provided by CRN can fit unified communications as easily as entertainment video. Indeed, the trend line in UC clearly is toward ubiquitous use of communications tools, including - indeed, featuring - video. Thus, the NDS acquisition seems to fit right in.



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