Cisco prepares to offload video business - Mobile World Live

Cisco prepares to offload video business

01 MAY 2018

Cisco announced a deal to sell its video software business back to Permira Funds, five years after buying the business from the private equity company for $5 billion.

A Reuters source said the deal is valued at $1 billion. Known as NDS, the unit currently offers service providers video software solutions.

Following close of the transaction, the unit will be rebranded and repositioned by Permira to become a new company “focusing on developing and delivering video solutions for the pay-TV industry”, said Cisco in a statement.

The deal will also “encompass a broad portfolio” of Cisco’s video products including its Infinite Video Platform, cloud digital recording, processing, security, middleware and service groups, the company explained.

Cisco said it will retain the video and media technology related to its core business in networking, multi-cloud, security, data and collaboration.

Video industry expert and former CEO of NDS Abe Peled will serve as chairman of the business: the sale was approved by Cisco’s board of directors.

Peled believes the acquisition represents “a unique opportunity to lead and shape the video industry during its transition with the flexibility as a private company”.

“Cisco has built a profitable business in the video space with innovations to capitalise on IP distribution and cloud-based services,” he added.

Too few dollars
Speaking to Mobile World Live, Paolo Pescatore, VP multiplay and media at CCS Insight, noted Cisco’s move to sell its video business to a private equity company follows a similar play made by Ericsson, and is a “reflection of a changing landscape”.

“There are too many solution providers chasing too few dollars,” he said. “Bottom line, many of these solution providers have diversified and now need to focus on core areas. Despite this, the media and telecoms industries are closer than ever.”

The transaction is expected to close in Cisco’s Q1 FY19 (the three months to end-October), subject to regulatory approvals and customer closing conditions.

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Kavit Majithia

Kavit joined Mobile World Live in May 2015 as Content Editor. He started his journalism career at the Press Association before joining Euromoney’s graduate scheme in April 2010. Read More >>

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