Cisco gets the message, ditches hosted e-mail service

Foray into a mature, crowded market proves unwise, unsustainable

Second-guessing is always easy ... and sometimes warranted.

(2011's 25 Geekiest 25th Anniversaries)

Take, for example, this morning's news that Cisco has decided to pull the plug on its year-old hosted e-mail service, Cisco Mail, citing as a reason the apparently newfound realization that IT executives have come to view e-mail as more of a commodity than a strategic application.

You don't say.

From a Cisco blog post announcing the decision:

The positive disruption represented by the cloud computing transition was what led us to introduce a Cisco hosted email product in November 2009. Customers told us they were interested in divesting responsibility for managing email on-premise in much the same way as they outsourced conferencing to Cisco via our SaaS WebEx Conferencing service.

In the thirteen months since, we've been market testing Cisco Mail via a controlled release. The product has been well received, but we've since learned that customers have come to view their email as a mature and commoditized tool versus a long-term differentiated element of their collaboration strategy.

In November 2009, when Cisco decided to enter this market, the IT landscape was already littered with established e-mail service providers; Google alone had spent years commoditizing e-mail.

Cisco's decision to dive in anyway is a head-scratcher that is said to have cost it $250 million, which while no doubt available in the company's petty cash drawer, could probably have been put to better use.

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