Cisco systems (NASDAQ: CSCO) abandons its efforts to move to a once promising market. The company has decided to significantly scale back its products and services department for smart cities in order to devote resources to other initiatives of the enterprise.
“We recently decided to stop selling and eventually support [for] the Cisco Kinetic for City [sic] product line to adapt our product investment to changing market needs and customer needs, ‘said a Cisco spokesman The Wall Street Journal.
The company’s efforts in the sphere received a major boost in 2016 when it acquired private Internet of Things (IoT) technology specialist Jasper Technologies in a $ 1.4 billion deal in 2016. At the moment, the buyer said that owning Jasper Cisco ‘would enable it to offer a complete IoT solution that is interoperable between devices and works with IoT service providers, application developers and an ecosystem of partners. ‘
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IoT devices and technologies are the foundation of smart cities – comprehensive digital initiatives that promise to modernize and automate much of the infrastructure supported by the world’s municipalities. Jasper was the cornerstone for Kinetic for Cities, a smart cities IoT unit founded in 2017.
The division’s closure comes after several quarters of Cisco’s revenue fell. As with many companies in a range of sectors, the budget for network equipment has been hit hard by budget cuts. This is due to the reduction in their spending on such products and services due to the detrimental economic consequences of the coronavirus pandemic.
Investors seem cautiously optimistic about Cisco’s retreat. The stock traded at nearly 0.9% on Monday, representing about the profit of the S&P 500 index.