Photo by Iker Urteaga

Cisco buys BroadSoft: Lego kit for the workplace

A story about the building blocks to build the future of the workplace.

Founded in 1998, BroadSoft has been at the forefront of innovation for collaboration and cloud communication technology, building a highly comprehensive technology portfolio, with an open communication suite, carrier-class security and reliability.

BroadSoft is market leader with 45% of installed base market share and 49.4% in the cloud UCaaS new users shipped market share, according to Synergy Research Cloud & On-Premise IP PBX Market Share Report June 2017, making cloud business applications and platforms available through more than 600 service providers in 80 countries, reaching over 19 million business subscribers.

Today, Cisco announced a definitive agreement to buy BroadSoft, in a near $2 billion cash deal and beyond the strong market positioning, I think this is a very clever move that suits both companies like a glove!

With the acquisition expected to close during the first quarter of 2018, BroadSoft employees will join Cisco’s Unified Communications Technology Group led by Vice President and General Manager Tom Puorro, under the Applications Group led by Rowan Trollope. This is also the unit responsible for Cisco Hosted Collaboration Solution (HCS), an on-premise solution designed for large enterprises (LE) which will now be complemented with BroadSoft portfolio for Small and Medium Enterprises (SME).

The journey to the cloud has been painful and difficult for most premises-based vendors because the transition is not only about re-designing their core platforms to support virtualisation, orchestration and elasticity. It also means a transition from a single-tenant model to high-scalable, multi-tenant services. With BroadSoft’s acquisition Cisco, who created for the last three decades the hardware-based networking world, is set to reinvent itself for the software-defined networking era.

Combining BroadSoft’s open interface and standards-based cloud voice and contact center solutions delivered through service provider partners with Cisco meetings (interesting to see what happens to BroadSoft Meet announced today), hardware and services portfolio, Cisco will be able to offer best-of-breed solutions for businesses of all sizes with a full suite of collaboration capabilities.

Leveraging BroadSoft’s extended support for hardware devices, it is likely for Cisco to extend support for Cisco devices with specific, enhanced features. There is also an opportunity to extend BroadSoft’s conferencing solution (My Room) to Cisco room-specific hardware, replacing UC-One Conferencing Room hardware. While My Rooms overlaps with Spark, Spark Room Kits could be adapted to offer a tailored proposition to the SME segment.

The last piece of the jigsaw is Cisco Spark, which was launched in 2014 as project Squared and relaunched as Spark 18 months later but lacks a truly integrated UCaaS capability — the integration with HCS is clearly not a next-generation, cloud-first solution.

With Microsoft’s new vision for intelligent communications announced last month bringing together Microsoft Teams (introduced just one year ago) and Skype for Business, BroadSoft’s acquisition is strategic for Cisco to compete with a messaging-UCaaS service and follows the strong investment profile for building Spark, which started with Acano (2015), and includes Tropo (2015), Synata (2016), Worklife (2016) and… now BroadSoft (2017)!

With this acquisition, Cisco consolidates the vendor strategy for dozens of Service Providers around the globe and positions themselves in the pole position to lead the future of the workplace.

The views and opinions expressed here are those of the author and do not reflect the official policy or position of any agency, organisation, employer or company.