Cisco’s Hosted E-Mail Service Says Goodbye

Cisco Systems pulled the plug on Cisco Mail, the hosted e-mail service it launched a mere 13 months ago.

While Cisco Mail was “well received,” Cisco found that customers were not interested in hosted e-mail as much as they cared about “social software and video,” Cisco said in a Feb. 22 blog post announcing the decision. Cisco declined to provide further details.

“We’ve since learned that customers have come to view e-mail as a mature and commoditized tool versus a long-term differentiated element of their collaboration strategy,” wrote Debra Chrapaty on the blog.

Cisco originally launched Cisco Mail in November 2009 because customers said they were interested in “divesting responsibility” for managing e-mail in the same way they switched to using WebEx for Web conferencing, according to Chrapaty. The service was rolled out via controlled release.

As more customers got used to the concept of cloud computing and saw the benefits, there was demand for additional cloud services, according to Cisco.

Cisco’s move demonstrated the challenge of penetrating a mature market and the difficulty in delivery a complex and demanding cloud-based application service, Matthew Cain, vice-president and lead E-mail analyst at Gartner, wrote in a research note. Cisco invested $250 million in the platform, according to Cain.

Cisco was completing against several established players in collaboration, including Google Apps and Microsoft’s Exchange Online, with far more storage for a lower price. Cisco offered a standard package of $5 per month per user which including Outlook support, Web 2.0 webmail client, e-mail, calendar, with only 5GB storage. In contrast, Google Apps for businesses offered more functionality with 25 GB storage for $50 per user per year. Microsoft offered cloud-based Exchange with 25GB of storage for only $5 per user per month.

For more, read the eWeek article: Cisco Kills Hosted E-Mail Service 13 Months After Launch.