The networking giant Cisco has recently made an offer to acquire the leading VoIP service Skype. Apparently Cisco seems to be venturing into several different domains such as video conferences, internet telephony, software services and even smart grid applications.
Cisco has been expanding its empire from networking to VoIP services and has been acquiring several large and small firms since few years. In 2005 it made the largest investment of $ 6.5 billion for acquiring cable TV equipment manufacture Scientific Atlanta. In 2009 it acquired Pure Digital Technologies, makers of DAB (Digital Audio Broadcasting) products. Cisco will have to pay $ 5 billion to acquire the VoIP giant, not so big for an empire like Cisco which is presently desperate to expand. Skype which was founded in 2003 has become a leading VoIP service these days enabling quality video and voice conversations. Skype has presently 560 million users. Google has also been in the news for quite some time for acquiring Skype.
Cisco is expected to incorporate its products with Skype VoIP services. The question that arises is that is it the right time and the right acquisition for a firm like Cisco to acquire Skype?
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