(Associated Press via NewsEdge) Cisco Systems is buying a private on-demand television company for $92 million cash, part of the network-gear maker's bid to become a consumer brand that delivers television, movies and other video on the Internet.
Arroyo Video Solutions, which was founded in 2002 and has 44 employees in California and Utah, bills itself as a company 'revolutionizing the way people watch TV.'
The California-based company creates software that helps computer servers store and send digital video, instead of keeping the data on disks.
The acquisition, expected to be completed by October 31, should make it simpler for Cisco's routers, switches and other networking products to store, send or receive video online.
Cisco and other companies want to specialize in on-demand video distribution because Internet users are becoming accustomed to watching television or movie trailers online.
'It fills a spot in the video distribution network and it buys Cisco a wonderful piece of technology and a good host of really good people,' Eve Griliches, research manager at analyst firm IDC, said of the acquisition.
Cisco is embarking on a major marketing campaign to familiarize average Internet users with the brand.
Last quarter, the company sold $7.98 billion in routers, switches and other networking gear, as well as DSL and cable broadband equipment, Internet telephone products and network management software.
In February, Cisco completed the $6.9 billion acquisition of Scientific-Atlanta, the No. 2 seller of cable television boxes after Motorola.
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