With Starent Acquisition, Cisco Focuses More On Wireless

Posted by: Peter Burrows on October 13, 2009

It seems Cisco Systems is turning its sights on the biggest, nastiest network-related problem facing the world’s Internet users: the inability of wireless carriers to handle the burgeoning traffic to smart devices such as the iPhone. That’s the takeaway from the company’s $2.9 acquisition of Starent Networks today. Here’s some details, courtesy of the NY Times.

In the past, Cisco has focused on pretty much everything but the big cellular networks. The company’s bread and butter is selling the gear for corporate network, along with plenty of extra fixins to run on top of them, such as wired VoIP phones, videoconferencing systems (it purchased Tandberg for $3 billion to bolster up in this market) and security software. It sells much of the gear that big phone carriers use in their wireline networks. And there’s consumer gear that’s used inside the home, such as wireless routers and even Flip video recorders (through its acquisition of Pure Digital earlier this year).

But ask most any iPhone user—certainly many in highly-trafficked cities—and they’ll tell tales of woe about miserable network connectivity and non-existent data service (full disclosure: I’m one of them. My iPhone is nearly useless as a data device in downtown San Francisco, and almost every call I try to make on the device from my home in the East Bay is dropped).

Hopefully, Cisco can use Starent’s software and hardware to come up with the gear necessary for carriers to cost-effectively keep up with the torrent of traffic coming their way. If it does, Cisco will surely be well-compensated.

Reader Comments

Fred Richards

October 13, 2009 3:05 PM

That's because historically, cell phone networks haven't been "real" networks like the internet. Their major setback? Non-openness.

I think this would be a threat to their business model. But I'm curious to see where Cisco takes the industry.

Technodude

October 13, 2009 11:00 PM

What CISCO has bought only serves the core of the wireless network and not the radio part which creates the bottleneck. The Radio network is the choke point for the smart phones and iphones of the world. The packet core network is like the ethernet router in your home without wireless nodes. Its just buying the backbone for LTE which is the next generation or 4G network. It will need to buy another 4G Radio Access product company to solve the issue being discussed.

BobP/CEO

October 25, 2009 11:48 PM

Cisco apparently is first in the M&A speciality and has lost all it's incentives to :provide critical infrastructure security. But don't give up, as we have introduced our Secure Network Infrastructure Interface that meets OSI Level One, CC up to EAL-6, PCI-DSS & Darpa 98 Standards and deliverable or can be licensed. We are also be releasing our own patented wireless & wired Hi Assurance End Point devices If we are good enough for the US & Canadian Govts besides the commercial marketplace, check us out by writing me directly: continuump@gmail.com .

America deserves better!

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Bloomberg Businessweek writers Peter Burrows, Cliff Edwards, Olga Kharif, Aaron Ricadela, and Douglas MacMillan, dig behind the headlines to analyze what’s really happening throughout the world of technology. Tech Beat covers everything from tech bellwethers like Apple, Google, and Intel and emerging new leaders such as Facebook to new technologies, trends, and controversies.

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