By STEPHEN HARDY
While much has been made about the use of mergers and acquisitions to acquire new technology and broaden product portfolios, such gobbling of companies isn't the only way to add to one's store of expertise. The recently announced alliance between Corning Inc. (Corning, NY) and Cisco Systems (San Jose, CA) illustrates a faith in good old-fashioned teamwork-a faith that other companies may begin to show in more abundance now that declines in market capitalization have liquidated a lot of companies' spare cash.
Cisco and Corning plan to form teams to develop "pre-engineered optical solutions consistent with customer requirements."
According to John Knight, marketing-communications manager, Corning Photonic Technologies, this agreement does not mean the two companies will pursue new-product development. Instead, they will collaborate on a customer-by-customer basis to pair their respective technologies in an optimal fashion.
The agreement covers Cisco's core products, particularly in the optical-networking space, and Corning's optical-fiber and photonic products. The latter include Corning's micro-electromechanical system (MEMS)-based optical switches and Raman amplifiers. The deal also calls for Cisco to become a customer of Corning's for optical amplifiers. Knight says Cisco's DWDM products would likely be the first beneficiaries of Corning's photonic product expertise.
This is the first time the two companies have formally agreed to work together, says Knight. He says he was not aware of a specific customer whose requirements had served as the catalyst for the alliance. The possibility of joint marketing efforts between the two companies has not yet been defined, he offers.
The nonexclusive agreement allows both companies to pursue other partnerships. Corning had already reached an alliance arrangement with Sycamore Networks (North Chelmsford, MA) covering the development of optical-switching products. Unlike the alliance with Cisco, however, Corning will engage in new-product development activities with Sycamore. The two companies plan to collaborate on three-dimensional MEMS optical-switching devices.
Corning plans to provide a range of expertise, much of it gathered through recent acquisitions. For example, MEMS technology will come from IntelliSense Corp. (purchased by Corning last year), array collimator technology from Corning Rochester Photonics Corp., servo and control design technology from the Corning Albuquerque Center (formerly Willow Systems, also acquired last year), optical engineering technology from Corning Advanced Photonic Technologies, and cabling hardware from Corning Cable Systems (which was a joint venture with Siemens before Corning purchased complete control).