In a research age where analysts and pundits race to provide up to the minute commentary, sometimes it pays to be slow off the trigger.  Last Wednesday, I had started to pen a post on Cisco’s latest smart grid partnership announcement with Itron.  Admittedly, my first reaction was much closer to the skepticism that Bob Gohn expressed when he declared the Cisco/Itron press release “buzzword bingo” than the bold pronouncement of Jesse Berst who opined that “Cisco seems to have a stranglehold on thought leadership and strategic foresight”.

Twenty-four hours can make quite a difference though and with last Thursday’s acquisition of Arch Rock, I am increasingly convinced that there is both bark and bite to Cisco’s strategy.  The company has clearly been on a partnership blitz across the smart grid landscape and has already managed to weave its tentacles into nearly all emerging smart grid silos.  Cisco’s march toward smart grid “IP Everywhere” is quite evident when you look at a cluster analysis that we developed of its relationships:

As active as Cisco’s business development and marketing bark has sounded in the space, it is the firm’s M&A and product development that heralds Cisco’s future bite.  The company has now made significant investments in building energy management (via the acquisition of Richards-Zeta in 2009 and now Arch Rock), home energy management (through the pilot of its Home Energy Controller at Duke Energy), advanced metering (Arch Rock), and distribution grid management (through the launch of the company’s substation routing and switching gear).

With nearly $40B in cash of the company’s balance sheet and a history of creative, aggressive acquisitions, I expect that the Arch Rock deal is far from Cisco’s shock and awe smart grid moment, but rather a warning shot to competitors.  Count me among the convinced that Cisco will be a force to be reckoned with as data communications across the full breadth of the smart grid (from premise to utility control center) migrates toward IP-based standards.