Cisco today announced the acquisition of Jabber, a provider of presence and messaging software. 

The acquisition will enable Cisco to embed presence and messaging services “in the network” and provide rich aggregation capabilities to users through both on-premise and on-demand solutions, across multiple platforms including Cisco WebEx® Connect and Cisco Unified Communications said the company. 

Cisco has to find new markets fast as its core market for router is slowing down. Hence the company has been on a buying spree acquiring Webex, Postpath and now Jabber and tranforming itself into a software play. The company has formed a Collaboration Software Group (CSG), consisting of Cisco’s major software businesses, network, service management and SaaS offerings.

Cisco will extend the e-mail and calendar functionality of its flexible software-as-a-service (SaaS)-based collaborative platform that includes instant messaging, voice, video, data, document management and Web 2.0 applications. This combination will enable customers to use collaboration to accelerate business processes, within and between businesses.

“The acquisition complements our strategy to develop an integrated collaboration platform designed for how we work today and into the future, providing real productivity gains and a more satisfying user experience”, said Doug Dennerline, Cisco senior vice president, Collaboration Software Group. “Our ‘cloud-based’ delivery model offers our customers rapid deployment and compelling economics.”

Rumors have been circulating that the company might buy VMWare to extend it cloud computing initiative. Cisco made a $150 million investment in VMWare in 2007 and owns 4% of the company.