IBM, Cisco announce $US2 billion technology pact

IBM and Cisco Systems yesterday announced a $US2 billion technology agreement, as well as Cisco's acquisition of portions of IBM's networking intellectual property.

IBM's Networking Hardware Division will sell its routing and switching intellectual property to Cisco, and Cisco has agreed to purchase IBM technology over the next five years.

The two companies also announced a new relationship between IBM Global Services and Cisco, under which the two will jointly offer services and develop systems for customers, and IBM will also offer full support of Cisco's networking system, including consulting, design, implementation and maintenance.

IBM will continue to support existing customers using its routers and switches, company officials said yesterday. Also, IBM will continue to support SNA (systems network architecture), token ring systems and Ethernet adapters through its worldwide sales and distribution channels.

But IBM will, in cooperation with Cisco, also assist customers in migrating to Cisco's network systems, and the two companies will set up an interoperability lab to test combined IBM-Cisco systems.

The alliance will allow IBM to leverage its strength in servers, software, services and technology, while Cisco provides its expertise in networking technology, said Dr James Vanderslice, senior vice president and group executive, IBM Technology Group.

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