Trapeze Swings With Nortel

As expected, wireless LAN vendor Trapeze Networks Inc. has become the second startup this week to benefit from Cisco Systems Inc.'s (Nasdaq: CSCO) acquisition of Airespace Inc.

Trapeze today inked an OEM deal with Nortel Networks Ltd. (NYSE/Toronto: NT), following a similar announcement yesterday between Aruba Wireless Networks and Alcatel (NYSE: ALA; Paris: CGEP:PA). Both Alcatel and Nortel are former partners of Airespace. (See Trapeze Scores Nortel OEM and Aruba Allies With Alcatel .)

Nortel is to rely on Trapeze for development of its latest portfolio of 802.11 products, dubbed the "WLAN 2300 Series" (see Nortel Unveils WLAN Plans).

"At the time of the acquisition by Cisco we decided we needed to look at another vendor because it is a competitive situation," Shirley O'Sullivan, EMEA leader for wireless LAN and security at Nortel, tells Unstrung. "The Airespace solution was really focusing on RF management. We knew we would be going down the route of focusing on delivering voice and multimedia applications over wireless LAN infrastructure... We had conversations with a number of vendors in that space, but Trapeze was our partner of choice."

Today's partnership follows previous reports of an acquisition bid by Nortel for the startup, at a price rumored to be between $125 million and $150 million.

"It isn't something we can comment on," says O'Sullivan. "At this present moment it is a partnership."

Trapeze's director of product marketing and business development, Michael Coci, reveals that Nortel has made "a financial investment" in Trapeze, but he claims such action is not unusual. "There is nothing out of the ordinary about it. 3Com made the same kind of investment in Trapeze... It isn't our strategy to go down the purchase path." (See 3Com Swings With Trapeze.)

— Justin Springham, Senior Editor, Europe, Unstrung

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