Cisco has joined forces with Ericsson, as the tech giants bid to create the networks of the future in a projected billion-dollar sales opportunity.
According to both parties, text-generation strategic partnership will combine the best of both companies: routing, data centre, networking, cloud, mobility, management and control, and global services capabilities.
Ericsson will together with Cisco, a market leader in IP-networking, offer end-to-end leadership across network architectures for 5G, cloud and IP, and the Internet of Things.
“With the pace the market is moving, the successful companies will be those who build the right strategic partnerships to accelerate innovation, growth, and customer value,” says Chuck Robbins, Chief Executive Officer, Cisco.
“This announcement brings together two visionary industry leaders, with complementary cultures and track records of innovation.
“We have worked with Ericsson during the last year on developing a strategy for future industry leadership, and can start executing together today.
“Our partnership will drive growth for both companies, unique value for our customers, and incredible innovation for the industry.”
In addition, the announcement is supported by multiple agreements including a global service partner agreement, as well as a broad reseller agreement.
Ericsson and Cisco are strong and complementary partners, with a combined 56,000+ patents, $11 billion of research and development investment, and more than 76,000 services professionals serving customers across more than 180 countries.
The strategic partnership will be a key driver of growth and value for the next decade, with each company benefiting from incremental revenue in calendar year 2016 and expected to ramp to $US1 billion or more for each by 2018.
New and greater opportunities are also expected, as the partnership enables both companies to drive their efforts and investments to deliver value in growth markets.
“This partnership fortifies the IP strategy we have developed over the past several years and it is a key step forward in our company transformation,” says Hans Vestberg, President and CEO, Ericsson.
“The extended addressable market is primarily in professional services, software and resell of Cisco products.
“The additional sales are expected to be accretive to operating income already in 2016.”
Ericsson and Cisco will continue to explore further joint business opportunities as the partnership progresses.