Cisco and Ericsson bet big on 5G and IoT networks

Cisco and Ericsson have announced a decade-long strategic partnership which will see the technology giants collaborate on the so-called ‘Networks of the Future’, including 5G, cloud and the Internet of Things.

The partnership, which was announced earlier this month, sees the two firms sign a number of agreements covering key areas such as joint research and development (R&D), a broader reseller agreement (the firms will sell each other’s products, and collaboration on emerging markets. The companies believe that the partnership could help each firm to ring up $1 billion ((£660m) in sales by 2018.

Financial terms of the arrangement have not been disclosed, although it is understood that, as part of the agreement, Cisco and Ericsson will discuss FRAND policies and enter a licensing pact for their respective patent portfolios. Ericsson said in a canned statement that it will pay licensing fees to Cisco.

This tie-up ultimately sees the two firms combining forces on 5G, cloud and the Internet of Things – covering everything from the development of IoT devices and sensors to access and core networks to enterprise IT cloud.

“Initially the partnership will focus on service providers, then on opportunities for the enterprise segment and accelerating the scale and adoption of IoT services across industries,” said Ericsson CEO Hans Vestberg in a prepared statement.

“For Ericsson, this partnership also fortifies the IP strategy we have developed over the past several years, and it is a key move forward in our own transformation.”

Chuck Robbins, Cisco’s CEO, said the announcement brought 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.”