Cisco Invests $320M To Acquire Major Software Partner Springpath

It has only been three months since Cisco Systems, Inc acquired the artificial intelligence startup MindMeld, Inc.  But with the ink barely dried on the $125 million, Cisco has already moved onto its next major purchase.

This time, the networking giant has shelled out $320 million to pick up hyperconverged systems software developer Springpath, Inc.  The second in only three months, this now makes Cisco’s fifth acquisition in just the last year alone: obviously it does not come as much of a surprise.

Hyperconverged infrastructure systems have been a major focus of enterprise hardware vendors for quite some time, now.  The idea behind these is the simplification of deployments at a time when software-defined architecture is starting to take over.  IDC actually projects hyperconverged infrastructure systems will be a $6 billion market opp within the next 10 to 15 years.

According to Cisco VP of business development Rob Salvagno notes, “This acquisition is a meaningful addition to our data center portfolio and aligns with our overall transition to providing more software-centric solutions.”

Indeed, the Springpath Data Platform has been noted as being built, specifically, for the hyperconverged infrastructure systems.  At its core, the software is, essentially, a file system that can store information on storage drives that have been embedded in low-cost commodity servers. The platform then organizes the data as a sequence of objects which are arranged, as Springpath claims, can actually increase the longevity of all of the underlying hardware, as well as improve overall performance.

As such, Wikibon Senior Analyst Stu Miniman comments, “Cisco’s acquisition of Springpath is unlikely to dramatically change the competitive landscape, since Cisco has dozens of storage partnerships (including with NetApp, IBM, Pure Storage, Dell EMC) that contribute billions of dollars to Cisco’s UCS and networking businesses.”

That said, many of Cisco’s partners also happen to be competitors in the developing hyperconverged infrastructure market.  While the company was a trendsetter at the beginning, companies like Dell and EMC have taken over. Miniman notes, “Cisco led the wave of converged infrastructure, but is trailing in a very competitive hyperconverged infrastructure market.”

At the end of the day, Cisco’s acquisition of Springpath shows the company’s willingness to invest, heavily, on improving its position in this particular sector.  Keep in mind that Hewlett Packard Enterprise Co just paid $650 million for SimpliVity Corp to break into the hyperconverged infrastructure race.

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