Cisco has discontinued its hosted email service launched in November 2009 after negative feedback from customers.
The firm said that the Cisco hosted email product was a reaction to customer requirements for less hands-on on-premise communications software.
"The positive disruption represented by the cloud computing transition was what led us to introduce a Cisco-hosted email product in November 2009," said Debra Chrapaty, senior vice president and general manager of Cisco's Collaboration Software Group, in a blog post announcing the end of the project.
"Customers told us they were interested in divesting responsibility for managing email on-premise in much the same way as they outsourced conferencing to Cisco via our SaaS WebEx Conferencing service."
However, in the 13 short months that the firm has been testing its Mail product Cisco has realised that firms are looking for something other than standard mail, wherever it is hosted, and Chrapaty hinted that the future might be in more "multimedia" type communications.
"In the 13 months since, we've been market testing Cisco Mail via a controlled release. The product has been well received," she explained.
"But we've since learned that customers have come to view their email as a mature and commoditised tool versus a long-term differentiated element of their collaboration strategy. We've also heard that customers are eager to embrace emerging collaboration tools such as social software and video."
This is the key factor in Cisco's decision to end investment, and the company has started removing trial customers from the project and supporting their transition onto other systems.
Matthew Cain, lead email analyst at Gartner, suggested that the Mail project had been a significant and expensive failure for Cisco, and that it showed the difficulties that all companies face when entering the cloud applications market.
"After investing $250m over two and a half years in a cloud email service, Cisco decided to quit the email market," he said.
"Cisco's failure demonstrates the difficulty in penetrating a mature market and delivering a complex and demanding cloud-based application service."
Although there are enterprise moves towards cloud applications, the Cisco proposition struggled because it did not offer anything really new, and struggled to distinguish itself from competing technologies such as Microsoft Exchange Online.
Cain warned in a cautionary note aimed mostly at end using enterprises "not to believe the hype".
"Our guiding principal on email is don't play dice with your email system. Organisations need to see truly tangible signs of success before committing to any cloud email platform," he said.
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