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Cisco, Motorola go wireless
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June 7, 1999: 7:50 a.m. ET
Combined Bosch Telecom acquisition puts tech giants into data, video market
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NEW YORK (CNNfn) - Computer network equipment maker Cisco Systems and mobile phone maker Motorola Inc. said Monday they've made a joint acquisition that will enable them to deliver wireless high-speed data, voice and video capabilities.
The companies, in a bid to capitalize on what is expected to become a $2.3 billion market by 2003, said they've acquired the wireless assets of Bosch Telecom, Inc., a subsidiary of Germany's Robert Bosch Corp., for an undisclosed sum.
As a result, Cisco (CSCO) and Motorola (MOT) will create a jointly owned company called SpectraPoint Wireless that will focus on delivering wireless high-speed data, voice and video capabilities known as LMDS, or local multi-point-distribution services.
"Under this agreement, Cisco and Motorola are bringing a new world Internet platform to the wireless industry " said Don Listwin, executive vice president, Cisco Systems.
LMDS can replace existing phone lines, cable and other infrastructures without construction and extra cabling work by using a small dish at the customer end for reception. The technology provides a single information stream that can carry high-speed data traffic into the home or business.
Under the transaction, expected to become final on June 30, Schaumburg, Ill.-based Motorola will be the majority stakeholder and San Jose, Calif.-based Cisco will hold a minority stake.
The companies, citing a 1998 study by Pioneer Consulting, said the LMDS marketplace will grow from $241 million in 1999 to $1.2 billion by 2001 and $2.3 billion by 2003.
Cisco shares Friday rose 6-1/16 to close at 114-7/8. Motorola stock gained 5-1/8 to 87-7/8. 
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