(TNS) — SAN JOSE, Calif. — Cisco Systems said Wednesday that it will acquire Jasper Technologies, a private cloud company used by businesses and telecoms, for $1.4 billion in a continuing effort to capture market share in the Internet of Things.
“We are super-excited at the prospect of what we could do in partnering with Cisco,” said Jasper CEO Jahangir Mohammed. “My team is thoroughly enthusiastic and we are looking forward to what the future holds.”
Mohammed will run Cisco’s new Internet of Things software business unit under Cisco Vice President Rowan Trollope.
The acquisition is yet another move by Cisco in its effort to ramp up its technology prowess for the burgeoning Internet of Things.
Cisco CEO Chuck Robbins said in a statement that the deal gives Cisco and Jasper a chance to accelerate Cisco’s offerings in the Internet of Things. “Together, we can enable service providers, enterprises and the broader ecosystem to connect, automate, manage and analyze billions of connected things, across any network, creating new revenue streams and opportunities,” Robbins said.
Cisco estimates the IoT market will eventually be in the trillions of dollars.
Jayson Noland, an analyst with Robert W. Baird, said the $1.4 billion pricetag “seemed steep” and the Internet of Things “squishy” and undefined at this point.
“I think it’s real, I just don’t feel like it’s very tangible today,” Noland said. “Do you want to see Cisco selling sensors that are going to sit in city street lights and cars? Probably not,” he said.
“This whole thing is going to take a long time to play out,” Noland said.
Jasper is a leading service platform for the Internet of Things, with more than 3,500 business customers. Its platform lets users connect to any device — “from jet engines to implanted pacemakers” — according to the news release announcing the deal.
In a conference call, Trollope said Cisco has an employee retention pool for Jasper employees. “People are the most important thing behind every acquisition, so we’re really focused on making this an attractive opportunity for the Jasper team,” he said.
The acquisition is expected to close in the third quarter of this year.
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