Contact: Mark Fontecchio
The race to replace email as the de facto standard for internal enterprise communications heats up as Cisco acquires Synata to power the search functionality in its Spark enterprise messaging offering. In addition to the tuck-in of Synata’s 10 employees, Cisco announced that it will invest another $150m toward supporting outside developers who are building apps around Spark. The deal marks Cisco’s fifth in the collaboration space since 2013, according to 451 Research’s M&A KnowledgeBase, and the company’s top line has benefited: its collaboration sales jumped 10% to $4.2bn in the past 12 months. The increased investment comes as a number of diverse vendors are converging on the enterprise collaboration and messaging market.
While collaboration software is convenient for instant communications, it can lead to a sea of messaging data that makes it difficult to find past conversations. Better search functionality helps providers pitch enterprise collaboration and messaging tools as a legitimate alternative to the old standby of email. Synata’s technology will help Cisco Spark do just that. In a recent survey of IT decision-makers, 80% said that instant messaging was of high importance when evaluating smartphones for their organization.
Those IT priorities are driving multiple players to push into collaboration. Microsoft recently revamped Lync as Skype for Business and purchased Talko at the end of 2015 to improve its VoIP capabilities. It’s not just legacy enterprises like Microsoft and Cisco that are drawn to this market. High-value startups such as Slack and Huddle are also making a mark here, and unified communications service supplier RingCentral and conference calling firm PGI bought into this sector last year. Even Facebook, with the recent launch of Work Chat, is eyeing this opportunity.
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