Bell Canada and Cisco Systems
Canada Co. are expected to announce a significant deal today involving
Internet protocol network equipment.
An industry source, who asked not to be named, said the announcement will be
made by Terry Walsh, president and chief executive officer of Cisco Canada,
and Isabelle Courville, Bell's executive in charge of sales to large businesses.
The deal would be just the latest in a series of similar moves made by many
telephone companies in North America. Internet protocol (IP) equipment can
combine data and voice transmissions on a single network, rather than the
current standard of two or more.
This cuts costs for phone companies and provides the foundation to sell new
Spokespeople at Montreal-based Bell didn't return calls for comment. The country's
largest phone company did however send out a dispatch to industry consultants
late Friday about a "very important announcement by Bell Canada" scheduled
for this morning.
Willa Black, a Cisco Canada spokeswoman, said "we will make an announcement
when we do have some news."
In September, Bell announced a three-year deal worth $200-million with Brampton,
Ont.-based Nortel Networks Corp. for IP gear. Nortel's specialty is making
such gear for telephone networks.
Nortel this month said it would be signing a five-year deal for IP products
with Verizon Communications Inc. of New York. Analysts think it could be
worth around $1-billion.
The specialty of Cisco Canada, wholly owned by Cisco Systems Inc. of San Jose,
Calif., is selling IP gear for businesses. Cisco is the largest communications
equipment maker in the world. It has a "long-standing relationship" with
Bell, Ms. Black said.
Vancouver-based Telus Corp., Canada's No. 2 phone company, announced new IP
services for businesses that use Cisco equipment in November.
Most industry analysts have been expecting some sort of important Cisco-Bell
deal since the Nortel announcement.
Bell is owned by Montreal-based BCE Inc., which also owns Bell Globemedia,
owner of The Globe and Mail and CTV television. In December, BCE unveiled
an aggressive plan to transform its network to IP standards.
" The [communications] industry is at a tipping point," Michael Sabia,
BCE president and chief executive officer, said on Dec. 17. "We intend to
set a standard for the industry. We will not be outflanked."
Bell's decision to deepen its connection with Cisco is likely to complement
the equipment it's buying from Nortel, said Iain Grant of telecom consultancy
Nortel's IP gear is mainly installed at a phone company's network hubs. Cisco's
gear is generally stationed on-site at individual businesses.
" From Bell's perspective, they simply want the world to know that if a
customer has needs, Bell has the solution," Mr. Grant said. " 'Look
no further' would be their watchword."