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Cisco to acquire Springpath

As the internet of things increases the amount of data that needs to be stored and analyzed at the network edge, Cisco wants to supply much more than network equipment. The company has been investing for years in platform software, and today Cisco announced plans to acquire one of the software startups it has been nurturing.

Cisco will pay $320 million for Springpath, a company it has been working with since 2012. Cisco has been an investor in Springpath, and led the company’s third financing round. Springpath makes hyperconvergence software for server-based storage systems. In 2016 Springpath and Cisco teamed up to launch a solution called HyperFlex.

With HyperFlex, Cisco is trying to provide an end-to-end software-defined infrastructure for industries such as manufacturing, retail, finance, education, healthcare and transportation. The goals of HyperFlex Edge are to reduce cost, minimize complexity, support always-on applications, shorten development time, deliver application peformance, and centrally manage remote and branch locations.

“By co-engineering Springpath’s software with the Cisco Unified Computing System, we have delivered a fully integrated platform with HyperFlex and innovation at all layers of the data center stack,” said Rob Salvagno, who heads Cisco’s mergers and acquisitions and venture investment teams. “This provides customers with the convenience and benefit of getting all the HyperFlex software and hardware from a single vendor.”

Cisco is buying into the hyperconvergence software space for about half as much as rival Hewlett Packard Enterprise paid for Springpath rival SimpliVity earlier this year. That acquisition led to speculation that Cisco would bid for market leader Nutanix, but this deal should put those rumors to rest.

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