The news was broken in a notice posted on NeoPath’s website. Cisco says it has also sent emails to NeoPath’s fifty-odd customers, who according to the immediate end-of-sale notice will not be able to renew current support contracts when they expire.
Whether Cisco gave customers any advance notice or option to extend their support contracts before the axe fell is not known.
Two weeks ago when Cisco announced its plan to buy NeoPath it did not say how much it was paying for the start-up, which had raised $29m in VC funding.
According to rumor, the price was around $40m. If that is true, it would make the acquisition a fire sale, and would explain why Cisco has decided that it will never sell enough of the NeoPath products to justify continued development and support.
The surprise move throws a new light on Cisco’s behavior last month. Back then the networking giant was very cagey about its plans for NeoPath’s products, which looked like a reluctance to admit that with NeoPath’s systems in its portfolio, it would soon be competing head-on for the first time with EMC. EMC is one of the largest resellers of Cisco’s storage networking gear.
But one of the statements that Cisco did make very clearly last month was that it planned to port NeoPath’s network virtualization technology to its switching silicon.
That will take Cisco into competition with EMC, but not immediately. Yesterday a Cisco spokeswoman confirmed that this is still the intention. We believe this will complement products such as EMC’s networked storage [NAS], the company said.
