Cisco Buy BlackBerry? Why John Chambers Must Say No

Should Cisco Systems (CSCO) buy BlackBerry (BBY)? Here are 7 reasons Cisco CEO John Chambers must say no thanks.

The VAR Guy

October 9, 2013

2 Min Read
Cisco Buy BlackBerry? Why John Chambers Must Say No

Cisco Systems (CSCO) allegedly ranks among the technology companies that may buy BlackBerry (BBRY). The VAR Guy doesn’t believe it. Cisco CEO John Chambers has learned some painful M&A and mobile lessons in recent years. Surely, Chambers doesn’t want to repeat those missteps buy acquiring BlackBerry… right?

First, the chatter. Reuters claims Cisco, Google, Intel, SAP and Samsung may make bids to buy some or all of BlackBerry. The story, based on anonymous sources, could simply involve BlackBerry backers trying to bring more bidders to the table or boost offer prices, The VAR Guy believes.

Either way, our resident blogger seriously doubts Cisco will make a bid to buy some or all of BlackBerry. The reason?

1. Cisco iPhone History: Cisco originally owned the iPhone name. Instead of fighting an extended war, Apple and Cisco in 2007 worked out a private agreement allowing Apple to use the name. Now that the iPhone and Google Android are market leaders, does Cisco really want to go back in time and wage a new war? Doubtful.

2. Cisco Tablet History: Anybody else remember Cisco Cius, a tablet that Chambers killed in 2012? Cius, built on Google Android, attracted little customer and partner interest. BlackBerry had similar setbacks with its own PlayBook tablet. Already a loser in the tablet wars, does Cisco want to get into the smartphone wars? Again, doubtful.

3. Cisco Apps History: Anybody else remember Cisco AppHQ — an App Store for Cisco’s failed tablets? The Cisco App Store never took off. Surely, Cisco doesn’t want to buy a BlackBerry app store that’s losing developers.

4. Cisco Focus: From about 2005 to 2011, Cisco’s strategy was all over the place. Tablets. Flip video cameras. Umi Telepresence in the home. Linksys for SMB and consumers. A lot of those products are either dead or sold off. Buying BlackBerry would confuse Cisco’s focus.

5. Data Center, data center, data center: Which technology giant will centralize, virtualize and converge servers, storage and networking first? Cisco hopes to win that race. Buying BlackBerry won’t help that effort.

6. Tuck-in Acquisitions: Cisco performs best when it acquires small, emerging, fast-growth companies. BlackBerry is a large, shrinking, imploding business. That hardly sounds like a Cisco M&A target.

7. CEO Transition: Chambers will transition his CEO crown to a new executive in the next few years. Surely, the next CEO doesn’t want to manage a BlackBerry turnaround strategy.

Of course, The VAR Guy may be overlooking two important areas:

  • BlackBerry’s patents: Are they worth anything to Cisco?

  • BlackBerry’s Mobile Device Management services: Are they worth anything to Cisco?

Perhaps yes and yes. But Cisco buying BlackBerry outright seems like a stretch to The VAR Guy.

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