Cisco, Ericsson Flirt with Merger

Rick Merritt, SiliconValley Bureau Chief
EETimes (11/9/2015 02:00 PM EST)

In a rapidly consolidating tech industry, sometimes the biggest players are at a disadvantage. Such is the case with Cisco Systems and Ericsson the world's biggest makers of infrastructure for wired and cellular networks.

The giants are too large to win approval from regulators to merge into the market behemoth they would most like to create. So they announced today a set of agreements to resell each other’s products and services as well as work to forge a tighter patent-licensing agreement.

It’s a good move executed under pressure. Rivals Nokia and Alcatel-Luncent announced in April plans for a $16 billion merger that would create the world’s second largest provider of telecommunications systems. With about $28 billion in revenues, the combined companies would leapfrog China’s Huawei, the current second place vendor, but still fall behind Ericsson.

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