Cisco has invested in wireless hotspot aggregator iPass, along with voice recognition firm Nuance and Lumera, a firm that makes polymers used in wireless antennae, biotech chips and electrical-optical converters.
"In general we look to invest in companies that have innovative technologies or unique business models that can help build the market for networking," said a statement released by Cisco to CRN.
Documents filed with the Securities and Exchange Commission show the firm bought two million shares in iPass, which equates to 3.2 per cent of its common stock. Cisco also bought more than 1.9 million shares in Nuance, about 5.4 per cent of its common stock, and 5.9 per cent of Lumera's stock.
While Cisco has historically invested in firms it has later acquired, it also has a strong record in picking growing markets and making money from investments.
"Cisco invests in all sorts of companies. It is a pretty smart investor," said Keith Humphreys, managing consultant at EuroLAN. "Where it invests sometimes indicates where it thinks the market is going."
"I wonder if this is just clever investment, rather than a case of Cisco buying into a company," said Barry Shrier, chief executive of hotspot firm Liberty Europe. "IPass is well outside [Cisco's] comfort zone. However, it is doing quite well - I'm a fan. This validates the need for roaming."
IPass makes deals with hotspot operators such as BT and T-Mobile, allowing its users to roam over different firms' public wireless networks in the same way as mobile phone users.
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