Cisco Systems announced yesterday that it had agreed to buy mobile-phone software company Orative Corp. for $31 million in cash.
Based in San Jose, Orative has 33 employees and makes an application that allows users to access corporate directories from cell phones and smart phones, while also providing presence information on whether the contact can be reached via text, voice or other means.
Orative’s Enterprise Software — comprising a server and agents that need to be installed on handsets — will work with several of Cisco’s existing voice products, including Unified CallManager for call control, Cisco MeetingPlace for collaboration, and Cisco Unity for voice mail.
The Orative clients run on Symbian OS handsets, RIM’s Blackberry devices, and BREW-based handsets. Cisco said it chose Orative for acquisition partly because of the breadth of its handset support.
Don Proctor, senior vice president of Cisco’s Voice Technology Group, which Orative will be folded into, explains in the following quote that the acquired company’s technology will help Cisco deliver a so-called "quadruple play" of unified-communications services.
Cisco’s Unified Communications system enables businesses to leverage their Cisco networks as a platform to provide the quadruple play—voice, video, data and mobility services—through a superior user experience. The Orative acquisition will allow Cisco to further deliver on its promise of extending the unified communications experience from the network services to mobile devices.
Founded in 2002, Orative had partnered with Cisco on several technology projects. Cisco said it expects the acquisition to close in the second quarter of next year.
As reported in eWeek, Cisco launched its United Communications system in the spring of 2006. In June, the company announced that it had purchased Metreos of Austin, Texas, for $19.8 million, and Audium, for $28 million, to bolster its IP telephony and IP contact-center capabilities, respectively.
This acquisition, like the other two, moves Cisco increasingly into competition with middleware and application vendors and away from its traditional networking markets and rivals. Driven by the need to maintain brisk growth and high margins, Cisco is being pushed out of its network-layer comfort zone and into the upper reaches of protocol stack.
Cisco is a formidable industry player, and it might well succeed in its effort to become a leading purveyor of unified-communications software and other applications. However, there’s also a risk that Cisco might not make the transition smoothly, and that it will lose focus on its core markets as it tries to capture new ones further up the stack.
Gartner Group delivered a similar admonition recently when it issued its Magic Quadrant for Campus LAN (Global) 2006 report.
While the report positioned Cisco in a leadership position on the quadrant graphic, the text of the report was critical of Cisco’s attentiveness to customer requirements and of the increasingly closed nature of its network architecture, which favors Cisco’s VoIP IP PBX and other communication solutions over those offered by other vendors.