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Cisco Acquiring Turbonomic Cloud Management Platform?

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Cisco CEO Chuck Robbins
Related: CEO Chuck Robbins on Cisco's SDN strategy.

Cisco Systems (CSCO) has discussed acquiring Turbonomic, a cloud management software startup valued at $800 million as of January 2017, according to The Information. It's unclear if Cisco will actually acquire the company.

Turbonomic develops a Hybrid Cloud Management Platform, which "enables heterogeneous environments to self-manage to assure the performance of any application in any cloud." The company's software "analyzes application demand and allocates shared resources in real time to maintain a continuous state of application health," according to Turbonomic.

Read between the lines and the networking giant may see synergies between Turbonomic and AppDynamics -- which Cisco acquired earlier this year for  $3.7 billion in cash. AppDynamics, which recently launched an overhauled partner program, specializes in application performance management and monitoring (APM), a high-demand area as DevOps teams and MSPs try to optimize applications on-premises and in the cloud.

Turbonomic Growth, Partner Program

Turbonomic’s Jennifer Heard

Turbonomic, launched in 2010, has enjoyed rapid growth in recent years. Through Q3 2016, Turbonomic experienced 25 consecutive quarters of record revenue growth, the company said at the time. It's unclear if that rapid growth rate has continued this year, however, since the company hasn't offered an updated statement.

Turbonomic also has a growing channel partner program. The company in April 2017 hired Microsoft veteran Jennifer Heard as senior vice president of Global Strategic Partners. At Microsoft, she was responsible for 1,600 sellers and 2,500 partners worldwide, her new employer indicated.

Even before Heard's arrival, the partner program was in growth mode. According to Turbonomic, for fiscal 2016 over $40 million of business flowed through the channel, which represented 100 percent growth from 2015. That included 914 partner transactions (60 percent YoY growth). Ten of the company's partners generated more than $1 million in Turbonomic business during 2016, the company said.

Cisco Systems' Evolution

Cisco, meanwhile, has been striving to evolve beyond traditional hardware and software sales. The company earlier this week acquired Springpath, a hyperconverged infrastructure (HCI) software provider that competes against Nutanix, HP Enterprise SimpliVity and various Dell EMC offerings. Also, the networking company has been pushing hard into cloud-based security services. While Cisco's recurring revenues are growing, the company's most recent quarterly results and financial forecast disappointed investors.

ChannelE2E has reached out to Cisco for comment about the company's potential interest in Turbonomic. We have not independently confirmed The Information's report about Cisco's interest in the company.

Joe Panettieri

Joe Panettieri is co-founder & editorial director of MSSP Alert and ChannelE2E, the two leading news & analysis sites for managed service providers in the cybersecurity market.