Cisco Builds Cloud Offerings with newScale Purchase

Cisco will build its cloud services capabilities through the acquisition of newScale, which makes cloud portal software.

Cisco Systems is looking to bolster its cloud computing services offering by acquiring privately held newScale, a company that offers software that enables businesses to more efficiently provision resources across their IT environments.

Cisco announced the deal March 29. No financial details were disclosed.

NewScale, which company officials said has about 2 million users worldwide, sells portals for cloud computing, enabling businesses to more easily and efficiently provision their IT systems, according to Cisco. Through its service catalog and self-service portal, newScale enables IT organizations to browse what services are available to them and order those services on an on-demand basis.

Cisco officials said such capabilities dovetail with their own network-based cloud computing strategy.

"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," Parvesh Sethi, senior vice president of Cisco Services, said in a statement. "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."

NewScale's FrontOffice Suite includes PortfolioCenter, on online brochure where businesses can find the services they're looking for, and RequestCenter, an automated request and fulfillment site where that can be deployed through the IT infrastructure, including physical and virtual servers and storage and networking devices. LifecycleCenter offers management of service items and workloads, and DemandCenter manages costs, billing and service demand.

Cisco officials said their cloud strategy is based on using the network as the foundational platform, enabling businesses and service providers to build and use cloud computing environments and services. The company hopes to leverage newScale's online cloud portfolio to expand the ways Cisco can get its IT and cloud software offerings to customers.

It also gives Cisco even more access to global enterprise customers. NewScale says that among the more than 100 customers on its list are AT&T, American Express, All State, Boeing, Gap, Macy's and Siemens. The company says that 20 percent of the Fortune 50 are newScale customers. Its software is found in a number of industries, including automotive, consumer goods, financial services, health care, oil and gas, and pharmaceuticals.

Cisco expects the acquisition to close in the second half of 2011. NewScale will be folded into Cisco's Advanced Services unit.

Cisco has been looking to bulk up its cloud offerings through both in-house development and via acquisitions. For example, in December 2010, Cisco bought LineSider, whose technology helps businesses' cloud infrastructure with their existing IT systems. Cisco officials said this will ease management hassles created within constantly changing networks when new virtual devices are added or moved.