NEC Corp. and Cisco announced a strategic partnership that will see the two selling end-to-end LTE network equipment.
NEC will supply the eNode Bs and mobile backhaul solutions. Cisco will provide its packet core switch, the ASR5000. The combination should help NEC compete with major vendors such as Ericsson (NASDAQ:ERIC) and Alcatel-Lucent (NYSE:ALU) that already offer a stronger end-to-end solution. NEC is a relatively small player in the LTE market, but the company did build the LTE network for Japanese giant NTT DoCoMo and provided base stations for Korea-based KDDI.
Peter Jarich, service director with Current Analysis, views the deal as one that is more important to NEC because "the vendor is essentially admitting that it needs support from Cisco in terms of the mobile packet core. Having sold itself as an end-to-end LTE solution provider for some time, the decision to work with Cisco could not have been taken lightly," Jarich wrote in a research note. "Given the success of its EPC offer, the impact of an added sales channel will likely be limited for Cisco--particularly given NEC's limited reach outside of Japan when it comes to the RAN. Of course, should NEC execute on its goals to become a bigger international player on the wireless front, Cisco could be a beneficiary.
The ASR 5000 switch is the switch Cisco acquired through its purchase of Starent Networks in 2009. Cisco, through its Starent acquisition, has now racked up some big contracts on the LTE and WiMAX side with the likes of Verizon Wireless and Clearwire (NASDAQ:CLWR). Other major customers include Sprint Nextel (NYSE:S), Vodafone and Cox Communications.
Last year Cisco stopped designing and building new WiMAX base stations, preferring to focus on the packet core. Cisco entered the WiMAX RAN market in 2007 through the acquisition of Navini Networks for $330. At the time, Cisco said it would focus on the packet core, femtocells and Wi-Fi.
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