500-220 information source - Cisco Meraki Solutions Specialist (ECMS) Updated: 2024

The acquisition of Isovalent will help the tech company boost its multicloud security infrastructure.

Tech multinational Cisco is set to acquire Isovalent, a networking and security company with headquarters in California and Zurich. The deal is for an undisclosed sum but is expected to close in the third quarter of 2024.

Founded by Thomas Graf and Dan Wendlandt in 2017, Isovalent is behind the rapidly growing open-source technologies Cilium and eBPF.

According to Cisco, the deal will help build on its Security Cloud platform – an AI-driven, cloud delivered, integrated security platform for various companies.

Jeetu Patel, executive vice-president and general manager of security and collaboration at Cisco, said the two companies will together build on the open-source power of Cilium to create “a truly unique multicloud security and networking capability” to help companies with their digital transformation journeys.

“Imagine in today’s distributed environment of applications, virtual machines, containers and cloud assets having security controls with total visibility, without hindering networking and application performance. The combination of Cisco and Isovalent will make this a reality.”

Following the closing of the acquisition, Cisco intends to continue offering and building on Isovalent’s platforms, including Isovalent Enterprise.

Stephen Augustus, head of open source at Cisco, said Isovalent’s team will join Cisco’s open-source governance and technical leadership to solve complex cloud native, security and networking challenges. “Their knowledge will accelerate innovation across the business and help further strengthen the Cisco Security Cloud platform to meet the growing demands of our customers.”

Cisco has had its eye on Isovalent for several years. In 2020, it joined Google and Andreessen Horowitz in its Series A funding round, which brought in $29m. At the time, Cisco stated in a blogpost that Isovalent was “a company to watch”. The start-up then landed $40m in Series B funding, a round which Cisco was also part of.

“It was clear from the beginning that Cisco came to the table with a clear vision to double down on our products and our open-source strategy with a strong commitment to our open-source projects,” Isovalent CEO Graf said in a blogpost.

“We are excited about this shared vision and what is ahead for Cilium and Tetragon, and we look forward to continuing our eBPF journey as part of Cisco to bring our technology and products to an even larger customer base.”

Earlier this year, Cisco snapped up cybersecurity company Splunk in a deal valued at $28bn. The company expects that deal to drive the next generation of AI-enabled security and observability.

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Configuration complexity and rules are among organizations’ most lethal, accidental risks when configuring networks and firewalls. Gartner predicts that misconfigurations will cause 99% of all firewall breaches this year. It’s the perfect use case for AI to prove its value to CISOs and CIOs. Not getting a hybrid cloud configuration right or a misconfigured firewall can lead to a breach no one has discovered until it’s too late. 

Cisco has been battling these risks on behalf of its customers for years. They’ve decided to go all in with AI and take on these challenges with their recently announced Cisco AI Assistant for Security and the AI-powered Encrypted Visibility Engine. The AI Assistant is trained on one of the largest security-focused data sets in the world, which analyzes more than 550 billion security events daily.

Cisco leveraged its deep network expertise by launching its Encrypted Visibility Engine. As the company told VentureBeat it’s designed to inspect encrypted traffic without the operational, privacy and compliance issues typically associated with decrypting traffic for inspection.

“One of the things that we wanted to do was make sure that AI was pervasive as part of the core fabric of Cisco security cloud, and every aspect of what we do in Cisco security, that’s what we’ve been working on,” Jeetu Patel, executive vice president and general manager of security and collaboration at Cisco told VentureBeat during a accurate interview.

When it comes to firewalls, complexity kills 

Cisco chose the right threat surface to go after with its most comprehensive AI cybersecurity release to close out 2023. Any CISO and members of their teams will admit that configuring firewalls, keeping the current patches and policies in place, and staying on top of any potential common vulnerabilities and exposures (CVE) is time-consuming and often gets ignored.

The greater the complexity of a firewall, the greater the chance it will get breached. Complexity will kill even the most effective cybersecurity strategy and well-implemented tech stack. Cybersecurity Insiders found that 58% of organizations have more than 1,000 firewall rules, with some extending into the millions. 

As a technology category that’s been around for decades, firewalls are ripe for more innovation. Gartner predicts that by 2026, more than 60% of organizations will have more than one type of firewall deployment, prompting the adoption of hybrid mesh firewalls. By that same year, more than 30% of the new deployments of distributed branch-office firewalls will be of firewall-as-a-service offerings, up from less than 10% in 2022.

Bringing policy chaos under control with AI

“Cisco is harnessing AI to reframe how organizations think about cybersecurity outcomes and tip the scales in favor of defenders. Cisco combines AI with its breadth of telemetry across the network, private and public cloud infrastructure, applications, internet, email, and endpoints,” Patel said.

Cisco based their AI Assistant for Security and AI-powered Encrypted Visibility Engine development efforts on their customers’ high priorities of streamlining firewall management. Patel said that when he and his team spoke with customers they kept hearing of the same challenges.

Patel added that customers wanted a more automated approach to checking configuration details, more insight when troubleshooting and an AI-based approach to optimizing rulesets. Patel explained that customer needs drove the three use cases the DevOps and engineering teams concentrated on. They include assisting (policy identification and reporting), augmenting (troubleshooting) and automating (policy lifecycle management). 

Cisco chose to develop the AI Assistant for Security inside their cloud-delivered Firewall Management Center (cdFMC) so they could leverage the latest large language models (LLMs). 

Raj Chopra, SVP and Chief Product Officer of the security business group at Cisco writes, “We created a generative tool designed to simplify firewall management for both seasoned admins and novice users. Utilizing advanced natural language processing (NLP) and machine learning (ML), it provides answers in seconds rather than forcing an administrator to spend their time sorting dependencies, network maps, and documentation.” 

What’s also evident from how AI Assistant for Security is architected is that Cisco will integrate more assistants across a wide spectrum of roles in their Security Cloud. The goal is to build out their cross-domain security platform with AI assistants available for automating security analysis and reporting tasks. 

AI still needs to have a human-in-the-middle to work 

There is a common trait across the rush to solve complex firewall policy problems and automate and streamline SOC team workflows with AI Assistants. That trait is the need for all of these tools’ models to keep learning and course correcting with human input while providing contextually useful information.  

VentureBeat spoke with Merritt Baer, Field CISO, Lacework, whose company recently introduced Lacework AI Assist. She told VentureBeat that AI-driven engines designed to parse policies help internal users understand their permissions better and that external users can better interact with their security insights and analytics. 

“Security product folks hope that these types of reasoning and query capabilities will allow users to better understand what might be layers of policies, which can be hard for humans to reason about— and product folks hope that this can help to do security more effectively. It’s no panacea—you still need to do something with that information. And folks should still ask their vendors about their internal security policies when using custom LLMs like this,” says Baer. 

On a broader scale, VentureBeat observes in most briefings on AI Assistants that the human-in-the-middle workflows are now table stakes in their product design. That’s evident in how well they are architected to flex between different roles. Ciscos’ AI Assistant for Security follows this paradigm and supports several standard configuration roles at launch.   

Just as AI assistants from Airgap Networks, CrowdStrike with Charlotte AI, Google Cloud Security AI Workbench, Lacework AI Assist,  Microsoft Security Copilot, Zscaler, and others can be configured for various roles, Cisco’s AI Assistant can flex from one role to another in security operations centers (SOC) with no re-configuration needed. 

CrowdStrike’s Charlotte AI also supports role-based AI-defined workflows and can integrate multiple best-of-breed AI models from third-party, open-source, or in-house development, ensuring the most appropriate LLM is used for a given task. Lacework AI Assist is also designed to scale across different roles, typically in a SOC. LaceWork AI Assist is unique in its ability to tailor and personalize insights while scaling between novice and expert cybersecurity professionals who can rapidly interpret and act on complex security data. 

Bottom line: How effective cybersecurity providers are at planning for the human-in-the-middle dynamics of their AI Assistants will directly impact their adoption and long-term contribution to securing organizations.  

NORTHAMPTON, MA / ACCESSWIRE / January 3, 2024 / Cisco Systems Inc.
By Stacy Betts

Embracing sustainability and reducing our environmental footprint has been a longstanding priority at Cisco. For almost two decades, Cisco has set transparent, publicly declared objectives as benchmarks, diligently tracking our progress and holding ourselves accountable. Additionally, we've developed comprehensive programs to empower customers to achieve their sustainability goals.

We understand that sustainability is a collaborative effort, and success requires leveraging our extensive partner network. Collaboration is essential, and it's through working with our partners that we foster innovation and gain support across the value chain. To this end, Cisco has developed several sustainability-focused programs that enable partners to offer customers end-to-end solutions designed with sustainability in mind, while also enhancing deal profitability.

Net zero by 2040

Cisco has embarked on an ambitious journey towards sustainability, aiming to achieve net-zero status by the year 2040. This goal has not been mere words but supported by continuous improvement and innovation across our entire business landscape. Our primary focus has been on delivering tangible, data-validated advancements that lead us closer to the realization of all our sustainability goals, ultimately culminating in our net-zero goal.

These efforts have not gone unnoticed. The approval of our net-zero goal by Science Based Targets initiative (SBTi) stands as a testament to the robustness of our plan, the allocation of resources, and the soundness of our strategic approach. This validation confirms our determination to truly meet these targets, helping to forge a path towards a more sustainable future.

As for our partners, whether you are just starting this journey or already investing, there are four key Cisco programs to consider, through which we work together to meet our sustainability objectives.

Earn Your Cisco Environmental Sustainability Specialization

Launched in 2022, the Environmental Sustainability Specialization (ESS) equips partners with Cisco-specific sustainability knowledge. It covers key sustainability terms, the technology behind our Sustainable Solutions, Cisco's commitment to a circular economy, and supporting programs. Only one person in the company needs to complete this training and exam. For others in the partner organization, we have additional efforts to educate partner sellers on these topics. If you're not the one going through formal training, we'll summarize the partner programs you should leverage in this blog.

Leverage the Cisco Takeback & Reuse Program Plus Incentive

Cisco's Takeback and Reuse program is integral to CEO Chuck Robbins' commitment to reclaim 100% of customer gear at no cost while providing partners with discount incentives. This program is an important step towards a circular economy, ensuring the responsible end-of-life management of returned equipment, with a remarkable 99.9% material recycling or reuse success rate.

Partners benefit from this initiative through a stackable discount of up to 7% on Refresh deals, applied to new equipment when replacing older gear. To learn more, visit our Takeback and Reuse Program page. Please note that this incentive is exclusively available to partners with ESS certification and program enrollment, so ensure your company is specialized to take advantage of it.

Strategically Position Cisco Refresh

With Takeback products, we seize the opportunity to remanufacture gear based on their life stage, making them available through the Cisco Refresh program. This refurbished gear supports the circular economy, meeting rigorous quality and performance standards, and is readily available with no lead times. It's cost-effective and environmentally friendly, and has a lower carbon impact than purchasing newly manufactured products. Explore available products on the Cisco Refresh list - the more we take back, the more we can offer!

Utilize Cisco Green Pay

Cisco Green Pay, through Cisco Capital, offers a flexible payment plan for solutions designed with sustainability in mind, covering hardware, software, and services with a set contract term. At term's end, Cisco reclaims the hardware to support the circular economy, helping support a more sustainable lifecycle. Cisco's ownership guarantees gear return, providing a consistent refresh cycle and benefits akin to the Takeback program. All of this is offered to the customer, requiring minimal effort from partners. Plus, customers receive a 5% discount when opting for Green Pay.

Let's Get Started Helping the Planet Together!

Ready to begin? First, become specialized under the ESS and enroll in the Takeback Program. Inform your Cisco team of your interest. We have partner sustainability specialists to assist you in integrating sustainability into your sales approach and boosting your confidence in discussing your customers' sustainability goals. Prepare for these conversations by researching your customers' public sustainability goals on their websites.

Although we've made progress in reaching our sustainability goals, we recognize that much more work needs to be done to ensure that people and ecosystems can thrive together on a livable planet. There's no time like the present to get started.

For further information, visit our Environmental Sustainability Products and Solutions webpage or consult your Cisco team for specialist guidance.

View original content here.

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Cisco Systems Inc. is holding the Asia-Pacific, Japan and China version of Cisco Live this week in Melbourne, Australia, where the highlight was the security news, as the company gave its cyber portfolio a shot of artificial intelligence.

Historically, Cisco and security have had somewhat of an on-again, off-again relationship – like Cardi B and Offset. Sometimes, you think they have it figured out, and then they don’t. This all changed about 18 months ago when the company announced its extended detection and response or XDR strategy and followed that up with its Security Cloud portfolio, which greatly simplifies the deployment of security technology compared with the mishmash that most companies have.

My research shows that enterprise-class companies have, on average, 32 security vendors. This is the average, and I’ve seen some companies with many more than this. I did some work with one of the government agencies, which had more than 200 vendors. One of the engineers there confessed there is so much paranoia around security that they deploy almost every point product from every startup to be more secure. The problem is, with security, more isn’t better, as keeping policies up to date is impossible across dozens of vendors.

This was the problem Cisco had. Although the company could market as a single vendor, its portfolio was a collection of point products. Duo, Umbrella, Talos and others are all great products, but more products do not provide better-in-class threat protection.

The new security leadership, which includes Executive Vice President Jeetu Patel, Senior Vice President and General Manager Tom Gillis and Senior Vice President and Chief Product Officer Raj Chopra, have quickly turned the Cisco Security ship around with its security cloud, comprising three suites. Breach, User and Cloud protection are the core of the strategy and the firewall is foundational to the clouds as it provides much of the data used by the suites.

At Cisco Live APJC, Cisco announced its new AI Assistant for Security, making AI pervasive across the Cisco Security Portfolio. This is critical for Cisco customers as attackers have used AI to stay ahead of businesses. “Our job at Cisco, as is the job of all security vendors, is to ensure that the scale tip in favor of defenders, and AI is the key to that,” Ambika Kapur, senior vice president of security marketing at Cisco, said in a prebriefing.

On the call, DJ Sampath, vice president of product and AI for Cisco Security, talked about the AI Assistant playing three roles – assist, augment and automate. Sampath talked about each of these.

“Assist changes the user experience where they can interact with Cisco Security using a natural language interface enabling our engineers to manage complex systems,” he explained. “With augment, we are creating the ability to add machine-driven insights to human intelligence to detect attacks faster. The automation capabilities can eliminate the mundane tasks an administrator needs to perform, enabling them to focus on more important tasks.”

It’s worth noting that Cisco designed the AI Assistant not to replace security engineers but, as the name suggests, to assist them, make them smarter, and enable them to operate faster. Modern security is largely data-driven, and there is far too much data for even the most seasoned security professional to understand. Machines can, and the AI Assistant makes the data more accessible.

The AI Assistant for Security is being launched within the Cisco Cloud Firewall Management Center and Cisco Defense Orchestrator to solve the monumental problem of managing and maintaining firewall rules. One might think this is straightforward, but I’m unaware of any company that does this well. Administrators create rules because of specific threats or other purposes. Then, another is created, but no one ever eliminates them or checks their validity out of fear something bad might happen.

Administrators can use the AI Assistant to discover policies, eliminate duplicate rules, get rule recommendations and speed up troubleshooting. During the call, Sampath went through a scenario where data was being exfiltrated, and without the assistant, the administrator would need to tweak a bunch of settings. With the AI Assistant, the administrator can request natural language.

Cisco also introduced its AI-powered Encrypted Visibility Engine for all its firewalls. It’s well-known that almost all traffic is encrypted today, which makes the firewall blind to the payload. One option is to decrypt the traffic for inspection, which has massive privacy and compliance implications and is also extremely processor-intensive.

Customers can find malware in encrypted traffic with the 7.4.1 Operating System, now available for the entire Cisco Firewall family. The new capability uses AI to demo billions of data points, including sandboxed malware, to understand the slight nuances of infected versus clean traffic. It can also tell which operating system the traffic is coming from and what client application is generating it, all without decrypting it.

Many think security is shifting to an AI-led industry, but that’s only partially right. I expect all the security vendors to have effective AI algorithms, which means data is the key differentiator, and this is where Cisco can flex its muscles. Because of its massive network footprint, Cisco can bring more data to the AI party than anyone.

Patel summed it up accurately: “To be an AI-first company, you must be a data-first company. With our extensive native telemetry, Cisco is uniquely positioned to deliver cybersecurity solutions that allow businesses to confidently operate at machine scale, augmenting what humans can do alone.”

Cybersecurity has been a long, winding road for Cisco, filled with starts and stops. After years of being marketing-led, Cisco security is now being driven by good, quality products that simplify the deployment of security technology. This leads to better threat identification and remediation, which is where Cisco’s focus should be.

Zeus Kerravala is a principal analyst at ZK Research, a division of Kerravala Consulting. He wrote this article for SiliconANGLE.

Image: Wikimedia Commons

Cisco (CSCO) has exhibited a modest 3.1% average revenue growth and 4.8% average adjusted operating profit growth over the past five years. The company is experiencing a decline in market share within both the networking and security end markets. Consequently, I recommend initiating coverage with a 'Sell' rating and assigning a fair value of $45.

Networking is Losing to Arista

It is evident that Cisco is ceding market share to Arista, with Cisco experiencing low-single-digit growth, whereas Arista (ANET) has achieved double-digit growth over the past few years. The accompanying chart underscores this trend, revealing that Cisco added only 1 million 100/200/400G switch ports compared to Arista's notable 2 million during the same period.

The decline in Cisco's market share can be attributed to several factors. Firstly, a decade ago, as enterprises began migrating their workflows to the cloud, Cisco did not promptly adjust its product strategy to align with the demands of the cloud transition era. Instead, the company maintained its focus on traditional on-premise routers and switching technology, neglecting significant investments in software-defined networking (SDN). SDN-powered switches offer greater suitability for cloud deployment, providing enhanced flexibility and scalability capabilities.

Secondly, a decade ago, Cisco held a dominant position, with traditional networking products generating substantial cash flow and profits. The challenge arose when it became difficult for the company to disrupt its own success and reallocate resources to embrace newly developed technologies.

Lastly, in 2013, Cisco introduced ACI, its premier software-defined networking (SDN) solution for data centers, utilizing the Nexus 9000 series products as spine and leaf switches. While Cisco endeavors to catch up with rivals in providing data center solutions, the company finds itself arriving late to the game. Moreover, Cisco's historical premium pricing is losing favor among enterprises as more budget-friendly options emerge.

Outdated Network Security

Cisco's End-to-End Security business encompasses Cloud and Application Security, Industrial Security, Network Security, and User and Device Security. A decade ago, Cisco's security business thrived as a bundled offering with their networking devices, providing a comprehensive solution for network integration. However, in the current era of cloud computing, their End-to-End Security has become outdated, lagging behind competitors such as Palo Alto (PANW).

In FY23, Cisco's End-to-End Security revenue only experienced a modest growth of 4.3%. It appears that their security products remain hardware-centric, a characteristic ill-suited to the evolving demands of cloud security and comprehensive protection. In contrast, rivals like Palo Alto employ a modular approach, offering multiple modules or subscriptions to counter various internet threats. The accompanying chart illustrates the revenue trends among major cybersecurity companies, highlighting Palo Alto and Fortinet's (FTNT) significant market share gains in accurate years. Their success can be attributed to software and module-centric products that align more effectively with the requirements of cloud infrastructure.

For readers seeking a deeper understanding, I recommend referring to my introductory article on Palo Alto Networks.

Splunk Acquisition

Cisco is strategically leveraging M&A to transition a significant portion of their business towards software and services. Noteworthy acquisitions include Splunk, acquired for $28 billion in 2023, IMImobile for $730 million in 2021, ThousandEyes for $1 billion in 2020, and Duo Security for $2.3 billion in 2018.

While the Splunk deal has the potential to enhance Cisco's capabilities in security and observability, it appears that there are limited synergies between Splunk and Cisco. The primary driver behind Cisco's decision to acquire at such a high cost is their struggle with topline growth. Cisco is paying a premium of approximately 30% over Splunk's market price before the deal was announced, with the acquisition price implying over 7x forward revenue.

The accompanying chart illustrates Splunk's revenue growth and adjusted operating margin trend, which is currently standing at around the low-to-mid teens.

Splunk specializes in security data analytics, operating a platform that collects extensive datasets from various sources. However, according to Palo Alto's management, Splunk's solutions may present challenges in promptly investigating cybersecurity incidents. Palo Alto's Security Operations Center (SOC), on the other hand, can seamlessly integrate AI into SOC transformation and automation processes, allowing for faster and more efficient investigation of cyber threats.

It's worth noting that Splunk is actively investing in AI and automation technologies, and its vast datasets remain a key advantage in the cybersecurity space.

In addition, Splunk is endeavoring to expand its presence in the infrastructure observability market. However, as a relatively smaller player in this space, it faces competition from established companies such as Datadog (DDOG) and Dynatrace (DT). It appears that Splunk, entering the field later, may struggle to compete effectively against these specialized players.

According to Datadog's management, Splunk's platform is centralized in security management, presenting a notable difference from Datadog's infrastructure, which operates in real-time. For a more in-depth exploration of observability, I recommend referring to my introductory article on Datadog.

In summary, the potential for synergies between Cisco and Splunk is questionable. This uncertainty arises from the fundamental differences in Splunk's business model, centered around subscription-based solutions, and Cisco's traditional hardware-centric business model.

Isovalent Deal

Cisco announced its acquisition of Isovalent in December. Cisco had previously participated in the startup's Series A funding at the end of 2020. Isovalent, a cloud-native security and networking startup, is expected to enhance Cisco's security capabilities for cloud infrastructure.

Isovalent leverages eBPF and Cilium to gather data sets from both Linux and Windows, integrating with various platforms and applications such as Splunk, Datadog, and Isovalent itself. I believe the acquisition of Isovalent will benefit Splunk's ecosystem. It's important to note that Isovalent, while a small company, faces competition from several alternatives in the market.

Financial Results and Outlook

During Q1 FY24, Cisco achieved a robust 7.6% revenue growth and an impressive 27.6% growth in adjusted net income, reaching the upper end of their guidance range.

Their balance sheet remains strong with $23.5 billion in cash and cash equivalents. Operating activities generated $2.4 billion in cash, and they returned $2.8 billion to shareholders through dividends and share repurchases.

For FY24, revenue guidance is set to be between $53.8 billion and $55 billion, with Non-GAAP earnings per share ranging from $3.87 to $3.93. The guidance suggests one or two quarters of low revenue growth followed by a return to normal growth. The subdued growth in the upcoming quarters is attributed to implementation constraints, with large customers working through elevated product shipments from previous quarters. Essentially, Cisco over-earned in the prior fiscal year. The current full-year guidance implies an approximately -5% revenue growth rate, a reasonable expectation given the over-earning in the preceding fiscal year.

The table below provides an overview of Cisco's historical financials. In summary, they have demonstrated a low growth rate in both topline and bottom-line figures, with an average of 3.1% revenue growth and 4.8% net income growth. Their balance sheet remains robust with a net positive cash position, and their dividend payout and share buyback activities are deemed decent.

Valuation

The revenue growth assumption for FY24 takes into account the near-term headwinds stemming from elevated inventory shipped to their large customers, aligning with their provided guidance. When projecting normalized revenue growth, the model assumes 3% for organic revenue growth and 0.7% for acquisition growth, consistent with their historical average.

Given the sluggish top-line growth, the likelihood of generating significant operating leverage is low. The estimate suggests only a 10 basis points leverage annually.

The model employs a 10% discount rate, assumes a 3% terminal growth rate, and considers a 19% tax rate. Based on these parameters, the calculated fair value is $45 per share.

Key Risks

Weak Growth in Q2 and Q3 FY24: As discussed in their Q1 FY24 earnings call, the management anticipates a challenging Q2 and Q3, attributing it to the elevated inventory shipped to their large customers. I believe the subdued growth in the upcoming quarters is temporary, and their growth rate should resume once these customers have successfully digested their inventories.

Collaboration Business Decline: The collaboration business, contributing over 7% to Cisco's total revenue, faced a decline of 9.4% in FY23 and 5.4% in FY22. Cisco encompasses Meetings, Collaboration Devices, and Contact Center businesses within this segment. The significant rise of Zoom (ZM) has introduced considerable downside risk for Cisco's collaboration business, and I anticipate ongoing pressure on this business segment in the future.

Conclusion

In light of the challenges Cisco is facing in the cloud transition era and the perceived erosion of their competitive advantages, particularly in the realm of on-premise networking, I am initiating a 'Sell' rating. I assign a fair value of $45.

Cisco announced this morning that it intends to acquire Isovalent, a cloud-native security and networking startup that should fit well with the company’s core networking and security strategy. The companies did not share the purchase price.

Isovalent has helped develop eBPF, a key open source technology that gives developers deep insight into the operating system layer, typically Linux, but also Windows, while Cilium, another open source project created by the startup, gives visibility into cloud native applications. Tetragon is the company’s open source security visibility component.

Tom Gillis, senior VP and general manager of Cisco’s Security Business Group, says the combination of these three elements used to be provided by a hardware appliance, but in the cloud world is increasingly software-driven. “In a cloud world, there’s still boxes in there somewhere, but it’s abstracted under layers and layers of software. And so eBPF and Cilium provide that visibility for cloud world,” he told TechCrunch.

Specifically, that involves being able to see exactly what’s happening as an application interacts with the network, and being able to determine whether that looks normal or not. “What this allows anyone to do is to provide a very high level of visibility into the inner workings of an application. So when one little container is talking to another container, Cilium can intercept and see that traffic, and it can also see the inner workings of the OS itself,” he said. “So this becomes a platform that allows us to provide connectivity, like should this particular cluster talk to that particular cluster, yes or no. But also security inspection, like what are they talking about? Does this make sense? Does this thing look logical?”

It’s worth noting that Cilium is the default connectivity and security piece for Google Kubernetes Engine, Google Anthos and Amazon EKS Anywhere. It’s also being used in a who’s who of large enterprises including Adobe, Bell Canada, Capital One, Datadog, Palantir, IKEA and Sky.

It’s always tricky when a large company buys a startup built on popular open source projects like this and it could potentially cause consternation in both the community and the large companies who have come to depend on this software. Isovalent has key roles at the Cloud Native Computing Foundation (CNCF) and eBPF Foundation, where they are also big code contributors. But Gillis says it’s in the best interest of everyone that the open source pieces thrive as a standard going forward.

“In order for that to happen Cilium and eBPF need to thrive, and so the community needs to continue to embrace them because the ubiquity of the standard is what makes it so powerful,” he said. Gillis sees it a lot like Kubernetes, which Google created and then open sourced. “I oftentimes say it’s the Kubernetes of the data path. It allows it’s an open standard that all can participate in, allows everyone to innovate on top of this platform, and build amazing products,” he said.

Jeetu Patel, executive vice president and general manager of security and collaboration at Cisco, said that it is essential for companies to work together where security is concerned. “One of the challenges that we’ve said is the true enemy [in security] is not your competitor, it’s the [common] adversary. And we need to make sure that we stay open in this market and co-innovate, and I think open source is probably one of the best models to co-innovate with,” Patel said.

Cisco was familiar with the company, even before today’s announcement, having participated in the company’s $29 million Series A at the end of 2020. The startup added a $40 million Series B in 2022 with Cisco also participating along with other strategic investors including Microsoft, Google and Grafana Labs.

Cisco has been extremely acquisitive this year, with this representing the eleventh acquisition by the company, the fifth related to security. The biggest of the bunch by far was the $28 billion Splunk deal announced in September.

This deal is expected to close some time in the second quarter next year (the company’s third quarter of its fiscal year).