14 DAY TRIAL // Until not so long ago, business representatives had to travel up to thousands of miles in order to present other companies with offers or marketing plans. As such, collaborations between businesses separated by long distances went slowly and saw more emerging obstacles than today. The invention of the webcam was the beginning of a new approach towards conferencing.
Through Internet live videos, meetings could be carried out even without the physical presence of all members and, thus, the progress was quickened and bureaucracy reduced. Aware of the great benefits given by such videoconferencing products, and of their popularity, Logitech decided to acquire its own means of producing them. Towards this end, yesterday (November 10), the well-known peripheral manufacturer presented its intention to purchase LifeSize Communications, a developer of such products with a wide range of customers.
Although Cisco Systems and HP seem to have the high-end videoconferencing market firmly in their grasp, they cannot say the same about the low and mid-end. Cisco's Telepresence and HP's Halo both provide HD services, but are not suitable for the lower segments because of their cost. This lower area is mostly covered by Tandberg, a Norwegian developer that Cisco wants to purchase for about $3 billion, and LifeSize itself. In purchasing the Austin-based company, the leading peripheral producer will grab a great share of the lower and mid-end sections.
“We expect this acquisition to enable Logitech to extend our leadership in video communication beyond the desktop,” Gerald P. Quindlen, Logitech president and chief executive officer, said. “Together we can make life-like, HD-quality video communication as mainstream and seamless as a telephone, for meeting participants in the boardroom, at their office desk, in a remote-location meeting room, telecommuting from home or on the go with a laptop.”
This deal will provide the Swiss IT enterprise with full rights over the Texan company's technology, as well as its customer base, which includes over 9,000 organizations across 80 countries. This will complement the software-based videoconferencing products made by SightSpeed, a business already owned by the Swiss organization. Logitech will add its own world-class manufacturing and supply chains and, together with LifeSize, will continue to collaborate with its other partners in the VoIP industry.
“LifeSize was founded on the vision of providing life-like visual-communication solutions to change the way the world communicates,” Craig Malloy, LifeSize co-founder and chief executive officer, added. “We believe that together with Logitech, we can realize that vision for all enterprises – private and public – and small and medium businesses. Our combined proven innovation can accelerate mainstream adoption of video communication by anyone, anywhere.”
LifeSize will operate as a separate subdivision, led by the current CEO, Craig Malloy, who will report to Gerald Quindlen. The purchase will be made for $405 million cash and the entire affair is expected to arrive at a conclusion in December, after the necessary closing conditions including antitrust approval are sorted out.