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Cisco buying Flip for $590 million

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The rumors turned out to be true: Cisco officially announced Thursday morning that it is going to acquire Pure Digital Technologies for $590 million in stock.  Pure is the maker of the Flip Video camera FierceOnlineVideo has worked with in the past, a low-cost and easy-to-use video camera.

Wall Street analysts seemed to be blasé about the news as Cisco spins the move as an acquisition to take its consumer business "to the next level" as Pure develops new video capabilities.  Cisco is bullish both on the prospects of video to continue to drive network bandwidth demand - and the need to upgrade to more powerful routers - and its ability to capitalize on current market conditions to expand and extend into new areas of business.

Once the acquisition is finished, Flip will be a part of Cisco's Consumer Business Group, which includes Linksys home networking, audio and media-storage products. Given that one of the Linksys products is a home media server, it's not a bad complement.

Over its lifetime, Pure Digital has sold more than 2 million Flip Video units and it is likely the company has a few more product tricks up its sleeve moving forward.

It's also worth noting that this is the second "user friendly" company Cisco has recently acquired; in 2008, Cisco bought Pure Networks for its easy-to-use Network Magic home networking software.

For more:
- Read Cisco's official announcement. Release.

Related articles
Cisco to acquire home network enabler Pure Networks - FierceTelecom
Who's buying? Significant VoIP M&A shoppers of 2008 - FierceVoIP
Flip Video: The value of good enough - FierceOnlineVideo

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