Cisco got US Department of Justice (DOJ) and European Commision approval of their acquisition of Tandberg.  Today’s announcement is due to the fact that the US DOJ will not challenge the proposed acquisition in light of the commitments Cisco has made to the European Commission.  The transaction remains subject to ongoing regulatory review in Brazil; however, the antitrust approvals from the European Commission and Justice Department represent the final regulatory approvals required before the transaction can close. Cisco and TANDBERG anticipate closing in the coming weeks.

Cisco Promises To Be Open

The European Commission’s decision takes into account Cisco’s commitments to enhancing interoperability between its multi-screen video conferencing products and competitive products. In addition, as a condition to receiving this approval, Cisco is required to appoint an independent monitor, who must be approved by the Commission, to oversee the implementation of these commitments.

Cisco’s commitments to the European Commission include divesting ownership of its TelePresence Interoperability Protocol (TIP) and the library of open source software useful to implementers of TIP to an independent industry body. Cisco will also provide the industry body with all other rights necessary to implement TIP and authorize the industry body to license those rights to any interested party, royalty-free. The independent industry body will evolve TIP with the benefit of participation by others in the industry. Cisco will also make available royalty-free information about Cisco’s own implementation of the protocol that will facilitate efforts to interoperate with Cisco multi-screen TelePresence systems.

According to Network World, Tandberg will provide Cisco with a range of low-end and mid-range videoconferencing systems to augment its high-end TelePresence system and fill out its virtual and videoconferencing portfolio. Tandberg also allows Cisco to become the market leader in videoconferencing.

There are alternatives to Cisco out there that are open and not closed.  The competing alliances are viewed by observers as a response by both Polycom and these vendors to the Cisco/Tandberg marriage and to the expected explosion in demand for video as a key component of unified communications deployments among businesses.

The joint offering will facilitate a “conferencing-aware” network for service providers rather than a video/telepresence overlay to networks not necessarily optimized for video, the companies say. Juniper says it may also offer Polycom-based video/telepresence to enterprises through other channel partners in the future.

The combined system includes Juniper’s Junos Space network application platform and its subscriber policy and identity services, MX Series 3D Universal Edge Routers, announced last fall, and SRX Series Services Gateways; and Polycom’s portfolio of telepresence and visual communication products, including the Distributed Media Application that centralizes call control.

Cisco Growth Is About M&A – $40 Billion Of Cash Helps

Cisco has billions of dollars in cash sitting around for deals like this.

I wonder if these deals will lead to any actual innovation and if these deals are just evil by Cisco.   Recent Cisco’s M&A activity take on brilliant corporate deal making but can it help the market grow for users and developers.   Some commentary here on innovation by M&A.

Cisco Taking On Skype ?

Market implications are that that Cisco will keep the technology proprietary to their own equipment and networks that only use Cisco.  Also this is a threat to Skype.  Skype is growing fast and approaching 800 million users and they have video.  Also, Skype has done deal with carriers and video is certainly at the heart of their future value proposition after they own “free long distance”.

The market wants  video in a big way.  The question is will it be on the market’s terms or Cisco’s terms.  Low end video telepresence will be a big market.  Skype has a big opportunity to do this with Skype TV.  I see the Tandberg deal with Cisco as a direct threat to Skype’s planned product called Skype TV.  Skype will now compete against Cisco which has no offering for the common web user.

Many are saying that Cisco’s Telepresence is pure luxury and a fantasy for mainstream users. To me Cisco Telepresence is the PictureTel of our generation – it’s super cool and high end, but irrelevant to “real web users”. Skype TV is a killer application and that product alone is a complete game changer. Skype could bring telepresence to everyone not just “wealthy enterprise” CEOs.

Cisco is known for making all kinds of crazy claims when launching products then not fulfilling them down the road.  We’ll have to keep a watchful eye on Cisco and their promise to be open.