The primary reason Cisco bought AppDynamics for $3.7 billion earlier this year was Cisco’s belief in how AppDynamics’ streaming data model could help penetrate the enterprise market, according to AppDynamics CEO David Wadhwani, who recently spoke at the AppD Summit in London, reports CIO.com.
Cisco believed AppDynamics’ data model "could make their networks even smarter," said Wadhwani.
For AppDynamics, on the other hand, it was all about scale and getting access to Cisco's enterprise customer network.
AppDynamics, which makes app monitoring software, already has a few big customers, such as Barclays and United Airlines. But the company wanted to expand quickly, and Cisco had the capacity to help it do so.
Prior to its purchase by Cisco, AppDynamics was on track to be one of the fastest growing publicly traded companies in the enterprise software space. Cisco bought AppDyamics Jan. 24, just before the company was planning on going public.
For Cisco, the purchase provides yet another opportunity for the network giant to move further into the subscription-based software space. The tech giant has recently been on a spending spree as it continues to transform. Earlier this week, Cisco announced plans to acquire Viptela, a software-defined wide area network (SD-WAN) company, for $610 million in cash and assumed equity awards.
Cisco has a long track record of snapping up other companies. Doing so gives Cisco a short cut to new solutions and technologies.