Cisco buys TANDBERG for $3B

Cisco Systems has bought TANDBERG, the video conferencing equipment manufacturer, for $3 billion, according to reports [1]. The move enables Cisco to grab some more video technology, which it has moved aggressively to bring in house.

Cisco, which bought consumer-facing video camera maker Pure Digital [2] in March, now adds heft to its enterprise video play with the TANDBERG buy. TANDBERG's products are less expensive than Cisco's high-end Telepresence gear, so Cisco adds market spectrum by acquiring TANDBERG.

The bid comes at an 11 percent premium to TANDBERG share prices, according to Silicon Alley Insider [3].

Cisco predicts both a $34 billion market for collaboration, and that video will encompass 90 percent of IP Traffic. This move seems to fit both future visions. CEO John Chambers was very bullish on video in Cisco's most recent earnings conference call [4]: "We continue to believe that video architecture is the most important Web 2.0 next-generation play and is one of the key competitive advantages versus our peers."

For more:
- see the New York Times report on the buy here [1] 

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