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In its largest acquisition in years, Cisco today announced it was spending $5 billion to acquire NDS Group, maker of technologies for pay-per-view television.Cisco hasn’t spent this much since it bought a company with similar technology in late 2005. It spent $6.9 billion on set-top box maker Scientific-Atlanta.
The NDS Group makes software for cable and satellite providers. Cisco is on a mission to revamp pay-per-view television and turn it into a two-way interactive thing.
With its Cisco Videoscape product, which it sells to service providers, TV viewers can interact with TV shows and ads in all sorts of ways. They can, from the video screen, chat about the TV show on Facebook or Twitter or they can pause a show and restart it on a mobile device. Most importantly for the service providers, viewers can also order products being advertised and have them billed to their cable TV statements.
The NDS Group’s software will be used to bolster Videoscape. NDS names some of the largest cable and satellite players worldwide as customers. Its U.S. customers include Cox and DIRECTV.
Funny thing is, that just a few weeks ago, rumours were circulating that Cisco was going to dump Scientific Atlanta — and get out of the set-top business. Cisco denied it. At the company’s last earnings call with analysts, CEO John Chambers said that Cisco was going to do more here, bringing service providers technology for Internet-based set top boxes and cloud services.
Big acquisitions like this are typical of Cisco when the company is trying to buy a customer base. If it succeeds, your television watching experience will never be the same.
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