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Cisco Bets On Hyper Convergence With Skyport Acquisition

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In an effort to expand its hybrid cloud capabilities, Cisco Systems announced its intention to acquire Skyport Systems.

The privately-held Skyport provides cloud-managed, hyperconverged systems that work to protect business-critical applications. The Mountain View, California-based company opened its doors in 2013 and went on to garner investments from companies like Intel, Index Ventures, and Alphabet’s Google Ventures.

Cisco itself demonstrated confidence in the company, having invested in Skyport’s $30 million Series C funding round in 2016 along with other investors.

Securing Hyperconvergence

Skyport brings together the usual suspects of computing, virtualization, networking, and storage into a single converged platform while integrating security measures to create what it calls “hyper-secured infrastructure.”

Rob Salvagno, head of corporate development and Cisco Investments, said in a blog post that the deal gives Cisco access to Skyport’s intellectual property, software, and network expertise “to accelerate priority areas across multiple Cisco portfolios.”

Cisco, of course, offers its own hardware through its HyperFlex HCI product. But we will probably see Skyport’s influence within the Cisco product suite soon. Nils Swart, head of product at Skyport, tweeted that he hopes the “much needed” technology that Skyport produced will find a good place within Cisco’s products and services, while Stefan Avgoustakis, Security Architect at Cisco, said in a tweet that he’s excited to work with the Skyport technology.

The Skyport team will join Cisco’s Data Center - Computing Systems Product Group and the Service Provider - Networking Group, helmed by Senior VP and General Manager Liz Centoni and Senior VP and General Manager Jonathan Davidson, respectively.

The terms and purchase price of the acquisition remain confidential.

Hyperconvergence Plays

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This isn’t Cisco’s first hyperconvergence play. Cisco acquired hypercongerged infrastructure (HCI) vendor SpringPath for $320 million in August of 2017.

Given the growth of the HCI market, these moves make sense. The global HCI market is expected to reach $12.8 billion by 2022, up from $804.5 million in 2015, according to Statistics MRC. More than an enterprise data center play, HCI systems have been moving into the SMB sector.

Of course, Cisco faces plenty of HCI competition. Key rivals include HP Enterprise, Dell EMC, along with Lenovo and Nutanix, which have made a joint play in the HCI market.