Cisco and Ericsson plan to jointly develop a series of SDN and NFV solutions as part of a broader strategic global business and technology partnership that will highlight the capabilities of both companies
While it did not provide any specific details about their SDN and NFV plans, Ericsson said that "teams from both organizations will also begin working on a joint initiative focused on SDN/NFV and network management and control."
Being able to collaborate on SDN and NFV initiatives makes sense for both companies. Cisco and Ericsson were previously named as preferred vendors by AT&T (NYSE: T) and Verizon (NYSE: VZ) in their respective SDN and NFV migration programs.
"As we look at how the incremental business would be combined there would be an element of resale," said Chuck Robbins, CEO of Cisco, during a call announcing the partnership. "We believe the integration with the network management to allow for more agile delivery of services, deployment of virtualized functions we think we'll expand the market opportunity by bringing more capabilities to our customers."
At the same time, Ericsson said that the new pact with Cisco won't affect its ongoing relationship with Ciena. Ciena became Ericsson's preferred partner for packet optical and software defined networking (SDN).
"We'll keep all of our partnerships intact," said Hans Vestberg, president and CEO of Ericsson. "We are looking at new elements that we did not have in our portfolio before."
In April, Verizon named Alcatel-Lucent (NYSE: ALU), Cisco Systems, Ericsson (NASDAQ: ERIC), Juniper Networks and Nokia Networks (NYSE:NOK) are its five initial SDN vendors. This is part of Verizon's move towards a software-centric network architecture to reduce costs and deliver new services to customers faster.
Likewise, AT&T previously named Cisco and Ericsson as partners in its Domain 2.0 program. AT&T has set a goal to virtualize and control more than 75 percent of its network using a software-driven architecture by the year 2020.
The two companies said that the overall partnership is expected to generate at least $1 billion in extra revenue for each company by 2018. This partnership will span a number of areas, including routing, data center, networking, cloud, mobility, management and control, and global services capabilities.
One of the key goals of the alliance is to create leadership positions in fields such as 5G, the Internet of Things (IoT), cloud and IP. The two vendors would also be able to better position themselves to meet the requirements of operators as they battle with growing data traffic and look towards the convergence of fixed and mobile networks.
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