Cisco launches new security services unit

Cisco (CSCO) is adding a Services Security Practice to its considerable services ops, with the dual goals of supporting its security hardware and offering value-added managed services.

As rival Palo Alto Networks can vouch, demand for cloud-based security services that are tied to locally-installed hardware is growing rapidly. Meanwhile, John Chambers has set a 5-year services revenue CAGR target range of 9%-11%, well above a total revenue CAGR range of 5%-7%.

Cisco is in the midst of giving its slumping security ops a shot in the arm by acquiring intrusion prevention system (IPS) leader Sourcefire for $2.7B. Sourcefire also offers some subscription-based services to complement its hardware.

Whereas upstarts such as Sourcefire, Palo Alto, and Fortinet have been posting strong Y/Y rev. growth, Cisco's security sales were flat Y/Y in the July quarter. However, that was an improvement from the April quarter's 4% drop.

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Comments (3)
  • Hendershott
    , contributor
    Comments (1891) | Send Message
    CSCO owns Sourcefire. Who writes this stuff?
    11 Sep 2013, 07:16 PM Reply Like
  • Eric Jhonsa
    , contributor
    Comments (1276) | Send Message
    I wrote it. The Sourcefire deal hasn't closed yet, so it's accurate to say that Cisco is in the midst of acquiring it.
    11 Sep 2013, 07:34 PM Reply Like
  • Hendershott
    , contributor
    Comments (1891) | Send Message
    I stand corrected.
    15 Sep 2013, 11:03 PM Reply Like
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