Cisco Gets Into The Container Business

Cisco jumped into hot container market Tuesday, announcing its plan to acquire early-stage startup ContainerX. The deal is another step in Cisco's shift towards software and services and away from its traditional hardware equipment business.

Founded less than two years ago, San Jose, Calif.-based ContainerX developed an enterprise container management platform. Its founders come from VMware, Microsoft and Citrix. Cisco said the companies will work together to help companies in their migration to the cloud using containers.

"With ContainerX, Cisco is continuing to invest in innovative technology and talent to help our customers in their transition to cloud native architectures using containers," Rob Salvagno, head of Cisco's M&A and venture investment team, wrote in a blog post. "This clearly supports our broader strategy to build and deliver secure hybrid cloud infrastructure, platforms, and services that offer our customers the freedom to choose the best environments and consumption models for their traditional and cloud native applications."

With its promise of streamlining application deployment, container technology -- especially the Docker form -- has been on a rapid rise. Salvagno said many of Cisco customers are starting to use containers to build and manage cloud-native applications, but noted that the container space is still emerging. While they experiment with containers, enterprises want to see the technology offer the same level of security and interoperability needed in their IT environment, he said.

The ContainerX acquisition comes as Cisco continues to focus more on software and services. The company recently announced that it will cut 5,500 jobs in a restructuring plan. CEO Chuck Robbins said Cisco will invest the money saved into growth areas such as security, cloud, and the Internet of Things.

Since Robbins succeeded longtime Cisco CEO John Chambers last summer, he has overseen other major acquisitions to drive Cisco's cloud ambitions, including the $238 million cash purchase of cloud security company CloudLock in June. In March, Cisco acquired cloud orchestration company CliQr Technologies.

Cisco said the ContainerX team will join its cloud platform and services group. Terms the deal were not disclosed.