Cisco Systems Inc. (NASDAQ:CSCO) has acquired Pure Digital Technologies Inc. for $590 million in stock.  Pure Digital is a company that makes digital cameras and video camcorders.  In addition to paying $590 million, Cisco will pay about $15 million in equity incentives to keep Pure Digital workers on board.

Pure Digital builds the Flip Video camcorder for $150-$230.  The Flip Video can record 60 minutes of video and can be plugged into USB drives.  These videos can be uploaded to YouTube.

Pure Digital started about 8 years ago and was powered by VC capital by Sequoia and Benchmark Capital.