790 could leave Cisco in Technicolor deal

Employee transfer looks to be part of sale of Connected Devices CPE unit

close up of a sold tag 122399287

Cisco could transfer or impact as many as 790 employees under terms of the sale of its Connected Devices business unit (CDBU) to Technicolor.

Technicolor and Cisco announced the $600 million deal today. Cisco’s CDBU offered set-top boxes from the $6.9 billion Scientific-Atlanta acquisition in 2005, as well as modems, gateways and cable cards to connect a customer’s premises to a video service. It was a $2 billion business for Cisco but a struggling one, where investors pleaded with the company to exit.

+MORE ON NETWORK WORLD: Cisco urged to fold more than Flip+

In his blog announcing the deal, Cisco Chief Technology and Strategy Officer Hilton Romanski said:

“Our employees will help define the future of a successful, global organization with a 100-year history of innovation”

When asked about this statement and if Cisco employees were being transferred to Technicolor, a Cisco spokesperson said in an e-mail that the company will not have specifics on the deal until after it closes, which is expected in January 2016.

“Until then the companies are operating independently,” the spokesperson stated.

The CDBU is managed out of Atlanta by Vice President and General Manager Joe Chow, a 14-year Cisco veteran. The main sites are Lawrenceville,GA; Shanghai;  Chennai, India; and San Jose. 

Cisco is also realigning other operations to accelerate momentum and prioritize investments. Cisco has combined previously separate Internet of Everything (IoE) and cloud sales, engineering and services teams into its worldwide sales, engineering and services organizations, according to this blog post from incoming CEO Chuck Robbins.

Realignments like this and the CDBU sale to Technicolor fall under Cisco’s “limited restructuring” (LR) plan to quickly and surgically redeploy and resize human and capital resources for high growth opportunities. This time of year – the end of Cisco’s fiscal year – is usually when LR activity and anticipation heighten.

“We will continue to make decisions to prioritize our portfolio and our investments to accelerate our business,” Robbins said in his post. “Part of this on-going prioritization is ensuring we have the right talent in the right places to drive our strategy and our growth in a very fast-paced market. Some functions and geographies across Cisco are making very focused changes to quickly re-align our investments to the top opportunities. A limited number of our employees will be impacted, but we will exit Q4 with our headcount up and, based on our current business assumptions, expect an increase in our headcount as we exit next fiscal year. It is our remarkable people who make everything happen at Cisco. We will treat our exiting employees with the respect they deserve and will continue to invest in our culture and talent to drive our success.”

Copyright © 2015 IDG Communications, Inc.

The 10 most powerful companies in enterprise networking 2022