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On Tuesday, Cisco Systems Inc. made a big move to increase its cloud security presence with an agreement to acquire OpenDNS for $635 million.
Founded in 2006, the San Francisco-based OpenDNS offers cloud-based security to stop malware, botnets and phishing attacks at the DNS layer through its Umbrella platform. Cisco participated in the company's most recent round of venture capital funding, which earned OpenDNS $35 million.
Under the agreement, OpenDNS will become part of Cisco's Security Business Group; Cisco will pay $635 million in cash and assumed equity awards, as well as retention based incentives for OpenDNS.
Cisco said it plans to extend OpenDNS' Umbrella platform and threat intelligence services to the Internet of Things (IoT) so that enterprises can quickly deploy additional security layers for millions of connected devices through the cloud.
"As more people, processes, data and things become connected, opportunities for security breaches and malicious threats grow exponentially when away from secure enterprise networks," said Hilton Romanski, Cisco chief technology and strategy officer, in a press statement. "OpenDNS has a strong team with deep security expertise and key technology that complements Cisco's security vision. Together, we will help customers protect their extended network wherever the user is and regardless of the device."
Cisco has made several moves recently to improve its security play in both the traditional network space as well as the cloud. Earlier this year, the networking giant acquired Chicago-based mobile and cloud security provider Neohapsis for an undisclosed sum. During RSA Conference 2015 this spring, Cisco announced a partnership with Elastica, a cloud access security broker (CASB), where Cisco would resell Elastica's CloudSOC platform to its enterprise customers and integrate the platform with its own offerings such as Cisco Cloud Web Security.
Cisco said the OpenDNS acquisition is expected to close in the first quarter of fiscal year 2016.
Find out how OpenDNS discovered a major DNS vulnerability in RubyGems