Cisco to buy Iodine for US$750m to boost AI offerings

[LOS ANGELES] Cisco Systems said it will buy Iodine for US$750 million to add artificial intelligence (AI) software used to help companies manage customer relationships.

The US maker of networking gear will pay 595 pence a share for the UK provider of cloud communications software. The cash offer, which includes debt, is expected to close in the first quarter, Cisco said in a statement.

Cisco's chief executive officer Chuck Robbins is seeking to recast the company - whose hardware is the backbone of the internet - as a networking software and services provider. He's responding to an industrywide shift that has seen more of the functions traditionally provided by in-house hardware migrate to outsourcing offered by remote data centres.

Cisco is seeking to push further into automation to improve the way its customers reach out to their end-users, enabling them to make their pitches and services more effective. And it wants to add those capabilities to its existing customer-relationship management offerings.

With Iodine, it sees an opportunity to use artificial intelligence software to automate the outreach process more effectively than is currently possible. For example, it will help customers channel their offerings into the approach that they prefer, such as through text messages, social media or a voice call.

Another instance is to provide a company representative with more contextual information about the customer they're dealing with to make sure that they tailor that interaction in a way that the customer wants.

"A great customer relationship is built on consistently enjoyable interactions where every touchpoint on every channel is an opportunity for businesses to deliver rich, engaging and intuitive experiences," Cisco senior vice-president Jeetu Patel said in the release.

The acquisition adds to a growing list of deals as technology companies seek to strengthen their AI capabilities. A week ago, ServiceNow said will buy Canadian startup Element AI, marking the software maker's fourth AI-related acquisition this year.

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