Cisco purchase of WiMAX provider to close in days

Cisco Systems Inc. and WiMax wireless provider Navini Networks Inc. should finalized the former’s US$330-million takeover deal in a matter of days, helping bring Cisco closer to its intention of bringing wireless broadband to emerging countries.

The planned acquisition of the Richardson, Tex.-based Navini, announced in October, was billed as a means “to drive broadband penetration to consumers and business in emerging countries,” according to a press release issued Oct. 23.

However, Cisco is not ruling out the possibility that WiMAX sales opportunities will open up in other markets including the U.S., said Brett Galloway, general manager of wireless networking at Cisco in a short interview at C-Scape 2007, a Cisco analyst conference. “We’ll go where the business is,” Galloway said.

Galloway said he is aware of the fluidity of proposals for WiMAX in the U.S., with some doubts raised about whether Sprint Nextel Corp. will continue its ambitious rollout of its Xohm WiMAX network nationally next year. Sprint officials said recently that they are studying the possibility of spinning off the Xohm unit and then buying wireless capacity from the new company to resell it.

The reason Cisco envisions a market for WiMAX in emerging countries is just because of a shortage of installed wires for Internet access.

“We see a real business opportunity in emerging countries and the opportunity to make a difference. This is enormously empowering for these people,” Galloway said in remarks on a panel about Cisco’s WiMAX plans.

Galloway also said that Cisco is prepared to support WiMAX along with a variety of other emerging wireless technologies, including Long Term Evolution, which could potentially compete with WiMAX. Supporting heterogeneity of networks also contributes to Cisco’s bottom line, he and other Cisco officials said.

Roger Dorf, the CEO of Navini, said the more than two billion people on the globe who do not have access to the Internet can be expected to want to gain access from desktop computers, primarily, since that is the technology used in homes and businesses in emerging countries where Navini operates today.

Eventually, as countries develop capabilities, users will expand to want other devices as well, he noted.

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