Networking giant Cisco Systems announced another acquisition this week. This time the company said it will buy the set-top division of a Chinese digital cable technology company.
Late Monday, Cisco said it would pay a total of about $44.5 million for the set-top unit of DVN. It will pay $17.5 million upfront, and the remaining $27 million will be paid over four years, based on the unit achieving sales milestones.
The deal is expected to close in the first half of next year, and it is subject to the approval of regulators and DVN shareholders.
Cisco is also partnering with the rest of DVN to provide joint customers with expanded services.
The DVN unit being acquired makes products that connect digital signals to televisions. Cisco already makes and sells set-top boxes for customers around the world through its Scientific Atlanta division.
Cisco sees a big opportunity in the Chinese cable market, which it says is the largest in the world with 160 million subscribers and with an additional 200 million subscribers expected to become customers in the next few years.
China is in the process of moving its cable subscribers to digital. The government has mandated that all cable be digital by 2015, Cisco said. Today only about a third of Chinese cable customers are using digital cable.
This is the fourth acquisition that Cisco has announced since the beginning of October. The company has spent about $6.2 billion in total during this shopping spree.
(Credit:
Pure Digital)
Updated 7:46 AM PT with comments from executives at Cisco and Pure Digital.
Cisco Systems, the world's largest maker of switches and routers that power the Internet, has taken another step toward becoming a major player in the consumer electronics market.
On Thursday the company announced it has acquired Pure Digital Technologies, the maker of the popular Flip Video camcorders. Cisco will pay about $590 million in stock for the company and will also provide about $15 million in retention-based equity as incentives to PureDigital employees, the company said in a statement.
Pure Digital started selling its consumer-friendly mini camcorder in May 2007. The device, which is a little bigger than a deck of cards and has a built-in USB connection, was designed to provide an easy and simple way to take video and upload it to the Internet, especially to popular sharing sites like YouTube and MySpace.
The device, which costs between $100 and $229, depending on the version purchased, has built-in memory storage to take up to 30 minutes or 60 minutes of video. The integrated software also makes the device easy to upload video to PCs or Macs. The product line has grown and now includes the Flip MinoHD, a small high-definition camera. Pure Digital says it has sold more than 2 million total Flip video units since the product first went on sale.
... Read more
Correction: An earlier version of this story misstated that technology from the Five Across acquisition was the foundation for the new Eos service. It is not.
LAS VEGAS --Two years after it first started courting big media companies, Cisco Systems will finally launch a new product to help these companies harness the power of social networking and connect their brands to fans.
On Wednesday, Cisco will kick off the Consumer Electronics Show here by announcing Eos, a hosted software platform that allows media and entertainment companies to create, manage and grow online communities. Through Eos Cisco has compiled technology tools and slapped on an easy to use interface to make building and customizing Web sites easy. But most importantly, it's bundled into the software, technology that will allow media companies to build interactive Web sites so that fans can connect with musicians, TV shows, movies, or whatever brand a media company wants to promote.
Cisco first began looking for ways to help big media companies late in 2006, when it created the Media Solutions business unit. The idea was to develop and market products to digital media content owners. In February last year, the company bought a startup called Five Across, which developed social networking software.
Dan Scheinman, the Cisco executive behind Eos, believes that the new software platform addresses one of the biggest problems that media companies face today.
"The reality is that media is so disrupted by digital technology," he said. "Fans are looking for ways to connect to their favorite artists or TV shows and they are seeking out communities, but the media companies have been slow to provide this for them. Eos is centered around community and allows fans to participate."
The service provides tools that allow media companies to create blogs, live chats, message boards, rating and ranking systems.
Scheinman believes that social networking is the most important way for marketers and big media companies to reach consumers. Consumers are using sites such as YouTube and Facebook to share media, like videos, music and pictures. He also believes that media companies can combat piracy by offering fans an interactive experience through their own branded Web sites.
"In many ways digital destroys the value proposition for media," Scheinman said. "Other people can rip off the content and monetize it, aggregate it, and take pennies for it."
... Read more- prev
- 1
- next
