Ericsson and Cisco commit to a future of cooperative networking, software, services and R&D
Nov 09, 2015
Ericsson and Cisco announced the formation of a global business and technology partnership today that answered not only how the companies would respond to the merger of Nokia and Alcatel-Lucent, but more important, how they are responding to the call for a new future by communications service providers (CSPs) and the enterprise.
When two of the leading networking companies in the world announce a sweeping, long-term strategic partnership and go out of their way to mention operations and business support systems (OSS/BSS)—not once in the off-hand way they are often mentioned, but several times and in a way that highlighted the strategic importance of OSS/BSS to future networks—it is obvious times have changed. Stratecast believes this to be a good sign that Ericsson and Cisco were truly thinking strategically, rather than merely financially, over the 13-month formation of their partnership.
Another good sign is that one of the main drivers for entering their partnership closely reflects one of the key needs of CSPs today: speed to market. CSPs are driven by an urgent need to become more agile and bring innovation to market in unprecedented ways. Ericsson and Cisco need to do likewise and could not have responded with anything even resembling “speed-to-market” had they chosen to go the merger route rather than partnering.
And while the two companies complement each other well in terms of addressing different aspects of networking infrastructure for IT—cloud network and data center, core routing and switching, wireless radio access and edge solutions—they also went out of their way to identify the first application of all of their combined R&D talent. It will be the development of a new, next-generation management system for multi-vendor networks. This will have implications across networks, including the management and orchestration of virtual networks supported by NFV and SDN, 5G networks and infrastructure for the Internet of Things. None of these things would benefit from the delay of another huge industry mega-merger. Only a partnership could deliver the speed to market that CSPs require to realize their next-generation visions.
Of course, the announcement of a partnership agreement and the good intentions and promises of CEO-level oversight mean nothing without execution and sustained commitment. The companies will have to match the benefits of speed-to-market with long-term security and assurances that they will remain close friends for the long-haul. Strategic partnerships have seldom stood the test of time when competing interests begin to get in the way (After all, at first glance it would appear that Ericsson is kicking its partner Juniper to the curb with this new agreement.) That Ericsson and Cisco have gone as deep as they have with the cross licensing of patents and technologies could help mitigate this potential zone of conflict.
Stratecast is anxiously awaiting more news on the co-development of a new management system and the application of Ericsson’s OSS/BSS portfolio to Cisco’s technology.
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