Cisco Systems Inc. has decided to buy BroadSoft Inc for $1.73 billion dollars. This action steers Cisco away from manufacturing and selling networking hardware, into offering softwares and services. The deal is projected to be closed in the first quarter of 2018, and It will be the companies second largest acquisition. BroadSoft differs from Cisco as their revenue comes from subscriptions and recurring software rather than physical sales of equipments. The companies aim is to move towards "cloud managed solutions," which it will do with the help of BroadSofts cloud communication development.
Cisco, being an established brand is venturing into new markets, targeting different costumers with the aim of increasing revenue. As the companies revenue significantly decreased, while subscription based programs were thriving, Cisco's management realized it was an opportunity for them to target this growing market.
By Fabio Montanari
https://www.wsj.com/articles/cisco-to-buy-broadsoft-1508762424
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