Cisco Drops Cloud E-Mail Service

 

Cisco Systems announced it has ended its Web-based e-mail service, Cisco Mail, after struggling for 13 months in the enterprise market.

"The product has been well received, but we've since learned that customers have come to view their e-mail as a mature and commoditized tool versus a long-term differentiated element of their collaboration strategy," wrote Debra Chrapaty, SVP and GM of Cisco's Collaboration Software Group, in a blog post. "We've also heard that customers are eager to embrace emerging collaboration tools such as social software and video."

Cisco introduced Cisco Mail in November 2009 to give its enterprise base the option of outsourcing e-mail hosting responsibilities. But it suffered from the steady growth of another cloud-based enterprise service launched two years earlier, Google Apps. Google Apps bundles e-mail, calendaring, and other productivity tools, along with 25MB of storage per employee for $50. In recent months Google secured Virgin America and the U.S. General Services Administration as clients.

In October, enterprise software leader Microsoft unveiled its own cloud computing bundle, Microsoft Office 365, which integrates Microsoft Office, SharePoint Online, Exchange Online, and Lync Online.

A Gartner analyst said Cisco invested $250 million in its first hosted e-mail product.

"Cisco's failure, after investing US$250 million, demonstrates the challenge of penetrating a mature market, and the difficulty in delivering a complex and demanding cloud-based application service, Matthew Cain, vice president and lead e-mail analyst at Gartner, wrote in a research note obtained by PCWorld.