Cisco clearly has faith in the Internet of Things (IoT) — or what it tends to call the Internet of Everything. It's spending $1.4 billion to buy Jasper, an IoT services platform provider.
The acquisition means Cisco will be able to offer an end-to-end IoT platform that is interoperable across devices and works with IoT services, application developers and an ecosystem of partners.
Cisco indicated that it plans to continue to build upon Jasper’s IoT service platform and add new IoT services such as enterprise Wi-Fi, security for connected devices and advanced analytics to better manage device usage.
In 2014, Cisco CEO John Chambers valued the Internet of Things (IoT) at $19 trillion. He estimates $14.4 trillion is at stake in the private sector and $4.6 trillion in the public sectors through 2024.
Jasper is a Santa Clara, Calif.-based company that provides a cloud-based platform that helps organizations launch, manage and monetize the deployment of the IoT worldwide. It said it has has connected 3,500 companies to the IoT, including 27 service provider groups
Established in 2004, it received $50 million in a funding round in 2014 led by Singapore-based Tamasek. Back then, it has an estimated market value of nearly $1.5 billion.Last October, when Jasper announced a partnership with IBM, we pointed out that Japer was ripe for acquisition.Jasper has built up its technology offering in such a way that it is — or was — an ideal fit for any of the IoT-focused IT giants, from IBM to Cisco.
Once the deal closes (probably in the third quarter) this year, Jasper's technology will be pulled into Cisco. Jasper CEO Jahangir Mohammed will run the new IoT Software Business Unit under Rowan Trollope, Cisco SVP and GM of the IoT and Collaboration Technology Group.
Jasper has spent a lot of time building up relationships and partnership with the world's telcos, a key requirement in developing a successful IoT strategy.Its platform also offers enterprises a relatively easy way onto the IoT without having to cough-up millions of dollars to modify their IT infrastructure or change their business.
The result is a number of high profile partnerships with the likes of Salesforce, SAP and Microsoft Azure over the past few years.
“Jasper recognized early on that in order to support its enterprise customers, it needed to tightly integrate with service provider networks. This strategic decision was game changing — it helped them create an expansive recurring revenue-based business model that offers more breadth and reach than any other IoT player today,” Rob Salvagno, VP of Corporate Development at Cisco wrote in a blog post about the deal.
He also pointed out that Jasper saw the IoT coming long before most other companies, noting: “When everyone was focused on flip phones and the early adoption of smartphones, Jahangir and his team focused their energies on connecting everything else, including GPS units, cars, security systems and point of sale devices."
From a business perspective it also makes shifting to a digitized IoT world a lot easier. In a webcast on the acquisition, Mohammed explained:
“For a company to make the transition from a product business to a connected services business is very complex. This is new territory with multiple parties involved? This is the problem we are solving with our platform. We are enabling enterprises move to connected services much faster, more economically, more easy.”
Cisco has been buying up multiple IoT providers. In October, it acquired Köln, Germany-based start-up ParStreamParStream markets tools to enable the immediate and continuous analysis of real time IoT data. Terms of the deal were not disclosed.
In July, it bought MaintenanceNet , a cloud-based software platform that uses data analytics for $139 million in cash. It bought Tropo, a cloud API platform that can help developers embed real time communications within their applications, in May.
In 2014 it bought automation network management provider Tail-f Systems and ThreatGRID for IoT malware analysis.
Title image by Peter Court