One crazy rumor that hit my radar screen today involves a mooted Cisco acquisition of Symantec.
I can see why Cisco would consider additional security acquisitions to complement its Unified Computing System (UCS) strategy, but Symantec isn’t the most logical target.
Let’s consider the valuation first. As security players go, Symantec is a big one. Cisco traditionally has eschewed large acquisitions, instead favoring smaller purchases of companies and technologies that can be seamlessly integrated into the Cisco operational machine and quickly monetized in the field.
Symantec would be a bear of an acquisition for Cisco to integrate and assimilate. If Cisco’s past comportment in these matters is an indication of future behavior, it will steer clear of potential disruptions and drawbacks associated with an unwieldy acquisition.
Seeking to refute that argument, some will point to Cisco’s sizeable acquisition of Scientific Atlanta. That was an exception to the rule, and an interesting one at that.
Cisco thought it essential to enter the set-top box market, where there weren’t many pure-play leaders, and none located in Silicon Valley. By process of elimination, Scientific Atlanta was the only strategic option that made sense under the circumstances. One alternative for Cisco involved buying all or part of Motorola. That would have been an act of corporate masochism.
Symantec, even after its misadventures and missteps in recent years, has a market valuation of more than $12 billion. McAfee, which has been getting the better of Symantec lately in the enterprise space and has been aggressively pushing a comprehensive security vision for cloud computing, is valued at just more than $6 billion. I’m not saying Cisco would go into its bank vault for either company, but McAfee would be easier to digest if Cisco determined that it had to make the move.
While Cisco would have product overlaps with McAfee or Symantec, the latter has significant parts of its business — such as Veritas’ storage management — that Cisco would be inclined to perceive as more liability, or irrelevance, than asset.
At some point, Symantec might cease to be an independent company. Network security appears destined for distributed integration into the cloud-computing fabric and into enterprise infrastructure. That said, I don’t see Cisco as Symantec’s buyer.