Cisco Systems Inc is strengthening its digital subscriber line arsenal with the $236m acquisition of Austin, Texas-based NetSpeed Inc, eight months after the networking giant bought another ADSL company Dagaz – whose products Cisco has not yet been able to bring to market. The principle difference, according to Cisco, between Dagaz’s product line and that of NetSpeed is one of standards – Dagaz’s product meets ETS’s standards and NetSpeed meets US carrier standards – which makes Dagaz products suitable for the European and Asian market and NetSpeed’s technology suitable for the North American market. Another difference is that NetSpeed’s products are already on the market, unlike those from the Dagaz stable. Upon purchasing Dagaz, Cisco realized its products were not ready for customers and pulled them. Cisco now plans to re-launch the Dagaz products within the next few months, according to Mike Volpi, vice president of business development at Cisco. Service providers will then be able to select either NetSpeed’s products, which are already in use by customers such as the operator US West, or Dagaz’s products, said Volpi. ADSL is not the only networking technology to link homes and small businesses to the internet that interests Cisco- the company has also developed 56kbps modems and is working with MediaOne on internet cable interfaces and products. Cisco sees ADSL challenging 56k modems in the near future, but believes the technology for high-speed transmission over copper wires will complement cable technology. Cisco plans to add cable interfaces to NetSpeed’s SpeedRunner. Cisco will exchange between 3.7 million and 4 million shares of its common stock for all outstanding shares and options of NetSpeed.
