Cisco, Cisco, Cisco. Another week, another acquisition. For those of you unaware of Cisco’s latest purchase details can be found here. Cisco’s acquisition of Pure Networks furthers a notion that CE manufacturers must accept: some skills cannot be found internally. For Linksys, the skills necessary to develop a simple set-up interface for its line of routers and complement that with a robust management tool to ensure network efficiency were found at Pure – which is why they initially partnered and ultimately acquired them.

For Cisco, the acquisition accomplished a number of important goals:

• Inhibiting competitors. With Pure as an independent entity its expertise could have been utilized by Cisco’s competitors. Acquiring them prevents this from happening and likely brings some Pure IP along with it.
• Reduces Commoditization. In a market increasingly sold on speeds, feeds, and price – offering additional functionality will help reduce the race to the lowest price for Linksys devices.
• Repeated customer interaction. Instead of simply engaging with the customer at purchase and then having their brand hidden under a desk amongst a mess of wires, Linksys can have a regular presence as an application providing means to monitor home network health, inform users when firmware upgrades for devices are available, and manage network traffic. This regular interaction could open the door for new business models and…
• A Linksys Ecosystem. With so many companies offering connected devices, Linksys could get into the game and offer its own connected ecosystem with its routers playing extra nice with its devices. This would ensure an easy set-up, up to date software throughout the ecosystem and advanced interoperability.

As important as the acquisition is for Cisco/Linksys to grow its digital home presence it is equally demonstrative of a major market shift: set-top box manufacturers ( Hey Cisco, don’t you own one of those?), HDTV manufacturers, pay TV service providers, mobile phone manufacturers must recognize their weaknesses (such as developing UIs) and find partners that complement their strength.

It’s not just the device, it’s not just the software or experience, and it’s not just about a static product. To succeed in the Anywhere world, you need it all. This acquisition demonstrates that Cisco has already figured this out.