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March 29, 2011

Cisco News - Cisco to Acquire Cloud Computing Software Provider newScale

By Laura Stotler, TMCnet Contributing Editor

Cisco Systems (News - Alert) will acquire newScale in a bid to ramp up its cloud computing services. Cisco announced the deal to purchase the privately held, San Mateo, Calif.-based newScale (News - Alert) today, but would not disclose the financial terms. The acquisition is expected to be completed in the second half of 2011.

NewScale provides software for delivering a service catalog and self-service portal for IT organizations, and boasts more than 2 million users throughout the world. NewScale software enables IT organizations to select and quickly deploy cloud services within their businesses, and enables commercial and enterprise customers to initiate the provisioning of their own systems and infrastructure as needed.

NewScale's customers include 20 percent of Fortune 50 companies, including AT&T (News - Alert), American Express and Siemens. The company will strengthen Cisco's cloud strategy, which aims to harness the network as a platform for building and using clouds and cloud services. The newScale acquisition will complement and expand Cisco's existing and partner software offerings in IT and cloud management and automation.

"Cloud computing represents a major shift in the evolution of the Internet, and as more customers migrate from traditional IT infrastructures, the need for rapid self-provisioning and efficient management becomes increasingly critical," said Parvesh Sethi, senior vice president of Cisco Services.  "With the acquisition of newScale, Cisco will be able to accelerate the deployment of cloud services through a service catalog and self-service portal that allows customers to easily manage their IT infrastructures."

Cisco shares were trading at $17.22 in premarket dealings on Nasdaq after the deal was announced, jumping by 0.2 percent.

Edited by Janice McDuffee

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