Motorola and Cisco terminates venture

As late as in July 2005 the two companies announced plans to deliver "a seamless enterprise mobility solution that will include Wireless Local Area Networking (WLAN) Internet Protocol (IP) telephony. Last month Motorola called the deal off. "Because the development process was so long, instead of bringing the next generation of the CN620 to market, we've decided to bypass that and go right into unified communications," Lisa Barclay, a spokeswoman for Motorola, told EETimes. "This was an industry first, and the initial device didn't include features that were important to cellular carriers only," she says. "For the next round, we'll be much more tightly integrated with them. We were really focused on enterprise needs with the first product. We focused on enterprise needs, figuring that the carriers would say that was great... Not so much." According to EETimes one unnamed source told that the deal was terminated because of infected relations with other business units within the company. "Motorola got pissed at Cisco because of the Scientific Atlanta acquisition," says one source familiar with the situation. "It made Cisco a competitor in the set-top box market." "That had nothing to do with it," Motorola's Barclay told EETimes. She says the problem was "carrier uncertainty around the value proposition." "Motorola cannot ignore Cisco's position in the enterprise PBX market and will support them along with Nortel Networks Ltd., Avaya and others," Ken Dulaney, VP of mobile computing at the research firm Gartner Inc., told EETimes.