Why Didn't Cisco Buy Move Networks?
Here's a scenario for you: Adaptive bit rate (ABR) pioneer Move Networks Inc. was distressed and on the block. Cisco Systems Inc. (Nasdaq: CSCO) was an investor in Move. Cisco needed an adaptive bit rate play to make Videoscape go.Inlet Technologies Inc. ? (See Cisco Paints Inlet Into Its Videoscape and Cisco, Comcast Invest in Move Networks.)
To hear Cisco explain it, Inlet's technology and approach for ABR are just better, so it was apparently happy to watch EchoStar Corp. LLC (Nasdaq: SATS) step up for Move's assets. (See EchoStar Buys Move Networks and Move Networks Is on the Block.)
And Cisco may have gotten itself a bargain if you take seriously a bizarre tweet from Move last summer suggesting it could be had for $150 million. (Foosball table included!) EchoStar has yet to disclose how much it paid for Move.
"We liked their [Inlet's] approach because they had a software-based strategy" that makes it easier for Cisco to integrate with Videoscape and support ABR on a wide range of video end-points, says Kip Compton, director of Cisco's Video and Content Platform business unit.
Move, by comparison, "really developed their own end-to-end system, which required a Move Network client to be present on the device that you were viewing the video," he adds. "Inlet's approach is maybe a little more powerful because it reaches a broader set of devices."
But doesn't Videoscape, Cisco's cloud-based architecture for the delivery of traditional and Web-fed video and content for service providers, also require a client, just like Move does? Not in every scenario, as it turns out. In fact, Telstra Corp. Ltd. (ASX: TLS; NZK: TLS), the lone announced Videoscape customer, isn't using one. (See CES: Cisco Unveils Master Plan for Video and CES 2011: Cisco Wants Videoscape to Play Nice.)
Compton says it makes sense for a Videoscape to be present on a popular device like an iPad because the client will support advanced features. But on less popular devices, a service provider may opt to go client-free and present the stream using HTML5 or the Microsoft Corp. (Nasdaq: MSFT), Adobe Systems Inc. (Nasdaq: ADBE) or Apple Inc. (Nasdaq: AAPL) ABR platforms that can work with a device's native browser.
Other reasons to buy Inlet included the possible benefits of integrating Inlet's encoding and transcoding technology with Cisco's Content Delivery System (CDS), and the fact that Cisco had already been working with the startup.
"Many customers have asked us to work together with them," Compton says.
Inlet's customers include Wealth TV, Major League Baseball and NBCUniversal LLC , which is now part of the Comcast Corp. (Nasdaq: CMCSA, CMCSK) empire -- but Compton says Inlet has been working with undisclosed service providers as well.
— Jeff Baumgartner, Site Editor, Light Reading Cable