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And Then There Were Three Cloud Email Giants
Posted by Ted Schadler on February 24, 2011
With Cisco's shuttering of Cisco Mail, multitenant cloud email is now (as my colleague Chris Voce called it) a battle royale between Microsoft, Google, and IBM, where the winner will have products, scale, sales channels, and big ecosystems of support.
I am not surprised that Cisco bailed on cloud email. All the signs were there:
- The company overpaid for PostPath in the midst of a buying spree. PostPath (which made some folks a lot of money when it sold for $215M) was just one of 17 acquisitions Cisco made in 2007 and 2008. Clearly Cisco was feeling confident that it could buy its way into new markets. (And it did with WebEx.)
- Cisco Mail was always to be released "any day now." It's fine to preannounce a product so that buyers know it's coming. But Cisco Mail never quite got shipped. The one reference customer never returned my phone calls.
- Cisco's collaboration platform doesn't require email. Messaging is one of the four big boxes of collaboration stuff. (The others are conferencing, workspaces, and social technology.) Messaging in particular can be carved out and offered separately. Cisco doesn't need email. It has WebEx and video conferencing. (The jury's still out on presence, chat, video hosting, and social technology.)
So when Debra Chrapraty announced that Cisco would shutter its cloud email offering, it wasn't a shock and it was something I would have advised her to do. (And in fact I did advise some executives no longer with Cisco to do so.)
So what's next for Cisco? Cisco has had a great run as a premium supplier of networking and voice (and now video) equipment. But for Cisco to be a credible supplier of collaboration services, it must:
- Deliver great conferencing and video conferencing tools. Cisco has announced higher quality video over WebEx, more products, and better integration between presence, WebEx, and Telepresence. Cisco must deliver on time and ahead of expectations.
- Get prices down to drive web meeting seats. WebEx is full-featured, expensive, and often not available to individual employees. So employees are sidestepping IT and a budget discussion to solve their own problem with free or cheap web meeting services from LogMeIn, SlideShare, and Wiggio.
- Don't miss delivery or quality on Jabber and Show and Share. These products extend the conferencing and collaboration portfolio in meaningful ways. And they are both strategic to Cisco's core business of selling routers, switches, conferencing, and video services.
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Comments
UC=???
I really feel that email is an integral part of unified communication. It is disappinting that Cisco couldn't get Cisco Mail to market- I think this was a step too far for Cisco. PostPath was initially a premise based offering- why Cisco didn't start there we will never know.
I would really like to see a "UC are we done yet?" post. Before we start hyping up the next "facebook for the enterprise", a number of companies still have some fundemetal work to do in terms of integration.
"Unified" should not be a marketing moniker. Aquiring your way into UC is fine so long as you do the work of ensuring you have a simpe to use, and simple to administer solution. Multiple points of administration and multiple clients, in my opinion; is not "unified."
Whither the code, and Qui bono?
Cisco has made a couple of blunders which resulted in financial losses to themselves and the loss of products that were really wanted by the market.
Postpath was really promising - when Cisco spent $215 million to acquire Postpath, the thought was that they were investing sufficient capital to generate some real competition to MS Exchange (which apart from its huge market footprint and integration with Active Directory is a mediocre mail platform at best).
Today Cisco announces they're killing the most widely selling consumer video camera, the Flip video, which they bought for $590 million.
The loss to the market of both products is a dirty rotten shame, not to mention the fact that even Cisco's enormous cash reserves should not protect their executives from scrutiny over flushing nearly a billion dollars down the drain.
The questions that arise are:
What will happen to the Postpath code? Will it be secured away in an intellectual property vault (perhaps in the same warehouse as the Lost Ark in the Indiana Jones film), never to be seen again? Is anyone trying to buy the Postpath code, or is anyone paying Cisco to kill it?
Cisco obviously has decided to get back to its core business - that much is obvious. But to simply kill such eminently marketable products rather than selling them, after paying so much beggars credulity.
The simple answer is Cisco is simply cutting its losses after realizing they were losing focus. But why not sell off the products instead of simply killing them? Qui bono?
Dripable.com
Curiously, a well executed piece!!