Cisco (Nasdaq: CSCO) is acquiring Inlet Technologies, one of the Triangle’s fastest growing and most promising high-tech companies, as part of its increasing commitment to online and wireless  video.

Inlet, a winner of multiple video industry awards since its founding eight years ago, provides video technology to customers around the world, including NBC, the BBC and Microsoft.

Cisco and Inlet announced the deal early Friday.

Cisco said it would pay $95 million in cash and retention incentives for Inlet. The company has 65 employees and the majority are expected to join Cisco, a Cisco executive told WRAL Tech Wire.

The acquisition of Inlet follows up on numerous recent Cisco acquisitions in the video space, from Flip digital cameras to Norway-based Tanberg.

The networking giant in its own mobile data forecast last week projected mammoth growth for video across smart phones, tablets, laptops and other devices.

“Service and content providers have a tremendous opportunity to deliver exciting video experiences as media consumption increases across mobile, desktop, and smart devices,” said Enrique Rodriguez, senior vice president and general manager, for Cisco’s Service Provider Video Technology Group.

“Cisco’s Videoscape platform will play a key role in reinventing the TV experience, and the acquisition of Inlet will enable our customers to leverage the network as a platform to deliver innovative video experiences to consumers on any device,” he added in a statement.

The Inlet employees will be integrated into Cisco’s Service Provider Video Technology Group.

First investor recalls Inlet’s late co-founder. Read here.)

(Read about Cisco’s plans for Inlet here.)

Inlet does not provide financial information, but based on data provided to Inc. magazine for its 2010 fastest-growing company list and a recent press release about the firm’s performance last year, the firm generated more than $15 million in revenue.

The company raised more than $20 million in venture capital under the direction of the late Neal Page. A pioneer in compression technology, Page helped start Inlet in 2003 and served as its chief executive. He died in July 2009 after a long battle with leukemia.

Don Bossi, Inlet’s chairman, took over as CEO last April after acting as interim chief executive for nine months following Page’s death. Bossi also is general partner at Technology Venture partners, an Inlet investor. Cisco said Bossi will be part of the transition effort between the two companies.

Using patented technology for both video and data compression as well as streaming technology, Inlet has been at the forefront of broadcasting and online video delivery from the time of its launch.

Inlet a Red Herring Global 100 winner

Last week, Red Herring recognized Inlet as one of its 2010 Global 100 list for promising privately held tech companies. Companies were selected based on criteria such as financial performance, execution of strategy, integration within their industries, and quality of management.

Inlet has developed a broad range of products, including hardware, and services for video compression and management. For example, Inlet can take one video feed and turn it into several outputs simultaneously for different devices such as mobile, high-definition, and Internet.

The company capitalized on the Apple iPad craze, developing technology to stream video to that device,

Aiming to give customers such as broadcasters more attempts to generate revenue, Inlet also developed ad insertion technology for use in live video streams.

Its technology is used by Major League Baseball for its offerings that include live video and audio streaming as well as archiving.

Other customers include Microsoft, MTV, NBC for Olympics coverage and Sunday Night Football, Xbox Live and Yahoo! as well as WRAL in Raleigh.

The quality of Inlet’s customer base demonstrates the quality of its technology and employees, a Cisco executive said.Kip Compton, director and general manager of Cisco’s Video and Content Platform Business Unit.

Inlet enables MLB to understand what kind of device a subscriber is using, such as a PC hooked to a broadband connection, and provide the appropriate feed.

Companies also use Inlet technology for video production and for housing on-demand video libraries as well as creating Blu-rays.

Inlet revenues doubled in 2010

While Inlet is privately held, some financial information was disclosed by the company to Inc. magazine which ranked the company at No. 647 in 2010 for growth over a three-year preiod. It ranked 45th among software companies.

Inlet reported revenues of $7.6 million in 2009, a 467 percent increase from $1.3 million in 2006.

At that time Inlet had 33 employees.

Last year, Inlet reported explosive growth with revenues doubling those of 2009, which were the previous high for the company.

Inlet also moved into a variety of new markets, including becoming a service provider for cable, telephone, satellite and wireless providers.

Its customer base grew by more than 70 percent. Inlet also doubled the size of its research and development staff and now has some 50 employees in Raleigh.

Inlet customers include BBC and other broadcasters for live video streaming across multiple channels for different devices.

International business grew sharply at a 200 percent increase, and Inlet now has customers in 35 countries around the world.

Capitol Broadcasting, the parent of WRAL Tech Wire, is an investor in Inlet.

Cisco employs more than 4,000 people at its campus in RTP.

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