Cisco announced today that they have agreed to acquire WebEx Communications for 3.2 billion dollars. While we have all used the WebEx platform many times, personally, I was never impressed with it and I think the value Cisco paid is completely overpriced. For starters, WebEx did $380 million dollars in revenue last year so Cisco is valuing WebEx at almost nine times revenue. This from a product that barely even supports any video functionality but is suppose to be thought of as the tool for on demand collaboration.
Cisco said they were acquiring WebEx because "…companies are looking for rich communications tools to help them work more effectively and efficiently." No argument there, but does a tool set that includes almost no option for live video and very limited functionality for linking to on demand videos classify as a real "rich communication" tool? I guess to some people it does, but I’d classify a system that focuses on video, like a Tandberg system real rich communication before I would WebEx. I know, Tandberg tends to be more of a point-to-point system as opposed to the WebEx platform but even the WebEx solution is operated across their private network. So the two are very similar in many ways, except one makes video a core component of their offering.
With the acquisition, I’d like to see Cisco add a lot of video functionality to the WebEx product line for real collaboration in live and on demand presentations and increase the size of the audience that can come to a WebEx, which currently is very limited. If they can do that, I think Cisco can be very successful with this application in the small and medium sized business market.
Are there any features or functionality in the current WebEx system that you think are missing?