Net2Phone, Cisco announces new company

Internet telephone company Net2Phone Inc. announced Monday that it intends to market network management software for Voice over Internet Protocol (VoIP) and other packet-based multimedia networks in a newly formed spin-off company, Adir Technologies Inc. Cisco Systems Inc. owns a minority share in Adir, the company added.

David Greenblatt, chief operating officer for Net2Phone, will be chief executive officer of the new company. Adir will be run separately from Net2Phone, which will, however, have a controlling stake in the company. The size of Cisco’s stake was not disclosed.

Howie Balter, chief executive officer of Net2Phone, characterized Cisco’s involvement as a vote of confidence from the networking industry and a way for Net2Phone to broaden its reach. “It provides new value from existing technologies … we now have the ability to unlock the technology and make it available to the world,” he said in a telephone conference call for the press.

Specifically, Balter noted that the deal will lead to greater interoperability between Net2Phone products and networks built with Cisco technology. Cisco will market Adir’s network management platform to its VoIP customers, Balter said. He added that Net2Phone expects to realize a substantial new source of revenue from software licensing fees, but probably not until the middle months of 2001.

Net2Phone developed the as-yet unnamed network management software for its own use, but has not yet released it on the market. The software can monitor the health, capacity and use of a packet-based network, including specific functionality, such as real-time advanced call management, rating, routing and authentication, according to Greenblatt. The software will be targeted toward large corporate customers and telephone companies looking to enter the VoIP field.

“It was clear that there was a need for large-scale management software,” Greenblatt said on the call. “There is no one out there offering a large-scale solution … Net2Phone is unique.”

Net2Phone products are designed to let customers to place phone calls over the Internet, either with microphones hooked into personal computers or with regular telephones, significantly reducing callers’ long-distance call charges.

Cisco, in San Jose, Calif., is at Net2Phone, in Hackensack, N.J., is at at