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Video - Wednesday, November 11, 2009

Logitech Pays $405M For HD Video Conferencing's LifeSize

PC peripherals maker Logitech has acquired high def video conferencing hardware maker LifeSize, paying $405M in cash for LifeSize. Lifesize is one of the leaders in the movement to make video conferencing a commodity. Lifesize is the world's third-largest maker of videoconferencing equipment,

Today, you see two extremes - video conferencing that you see on Skype for free and them multi-million dollar packages sold to corporations for their board rooms.

Six-year-old LifeSize, has 200 workers in Austin, TX and 300 worldwide.

LifeSize has raised about $81M in venture backing. Lifesize's backers include Austin Ventures, Lehman Brothers Venture Partners, Norwest Venture Partners, Pinnacle Ventures, Redpoint Ventures, and Sutter Hill Ventures.

Logitech said LifeSize is expecting revenues of approximately $90M in CY2009 with with growth of 40 to 60% in 2010. To date, LifeSize has sold about 30K conferencing systems to 9K customers. The cost of Lifesize ranges from $6000 to $9000 but a feature is that you don't need a systems intregration firm to set it up.

The new firm's biggest competitors are Polycom and Tandberg. Both are larger and more established companies. And interestingly, Cisco Systems offered $3B to buy Tandberg last month but that deal has been on the edge.

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