Cisco Picks Up Video Surveillance Firm for $51M

Cisco plans to integrate SyPixx's network video surveillance technology into new security applications that make live and recorded video available online.

Cisco Systems said on March 7 that it was buying video surveillance firm SyPixx Networks for $51 million.

The San Jose, Calif., networking equipment maker said it plans to integrate SyPixxs network video surveillance technology in a range of new security applications that make live and recorded video available online.

The acquisition may not be the last in the physical security space. Cisco is launching a new business unit to create products that integrate security infrastructure, said Marthin De Beer, vice president and general manager in Ciscos new and emerging technology group.

Founded in 2004, SyPixx is based in Waterbury, Conn. and has a development office in Carlsbad, Calif. The company makes technology that can transmit video, data and audio over IP and fiber optic networks.

The acquisition is still subject to regulatory review and shareholder approval. Cisco expects it to complete within 60 or 90 days, the company said.

Cisco hopes to use the SyPixx technology to shake up the video surveillance industry, which is still dominated by proprietary, analog surveillance technology that is inefficient and hard to manage, De Beer said.

For example, SyPixxs encoder and decoder technology can convert analog video to digital (IP) video. The companys decoders allow employees to use keyboards and joysticks connected to an IP network to control cameras anywhere on that network, he said.

With Ciscos backing, SyPixx technology could be used to marry physical surveillance with the IP networking, so that video data is available anywhere at any time, and can be searched and reviewed rapidly.

"SyPixx is the solution that allows Cisco to insert into the market and manage legacy analog video as well as digital IP solutions in one environment," De Beer said.

Eventually, customers will move to totally digital IP, he said.

SyPixx will be housed in a new business unit that Cisco is calling the "Converged Secure Infrastructure Unit, which will be part of Ciscos Emerging Markets Technology Group and be headed by De Beer.

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Cisco will be looking for ways to add more physical infrastructure technology to the secure infrastructure unit. The company is working on some technology internally, but De Beer didnt rule out acquisitions in other physical access technologies like door locks.

"Were going to take a comprehensive look, not just at video … We want to make the network the platform for physical security," De Beer said. Integrating physical and logical security is the Holy Grail for many senior corporate security executives. However, the goal has been elusive.

In 2003, Computer Associates International formed the Open Security Exchange with physical security companies like Tyco International, lock maker ASSA ABLOY and secure card firm Gemplus International to promote collaboration between industries in the area of security management. However, little has come out of that effort.

Physical security is often managed separately from network security, according to Jon Oltsik of Enterprise Strategy Group.

"The rule is that physical security is a facilities thing and [information security] is an IT thing," he said.

However, Cisco has the clout and the access to senior decision-makers at companies to change that paradigm, he said.

"They can bundle the physical security stuff and bring down the overall price of security and network, so they could use that to their advantage," he said.

Video, like VOIP (voice over IP), offers Cisco a new way to appeal to companies and to increase the demand for network bandwidth and follow-on applications, Oltsik said.

"As Cisco develops its enterprise strategy, this is another foot in the door," he said.

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