Cisco Systems will acquire The Linksys Group, one of the leading providers of home networking products, for approximately $500 million in Cisco common stock. Linksys currently offers more than 70 products, including wireless routers and access points for simultaneous sharing of broadband Internet connections, wireless network adapters and wireless print servers as well as traditional wired products such as Ethernet routers and cable modems, unmanaged switches and hubs, print servers and network attached storage for easy sharing of digital music, photo and video media files. Linksys’ sales are made through retail, e-commerce, catalog and distributor channels. Linksys claims to be the market leader in worldwide, consumer WLAN sales. Cisco said the deal represents its entry into the high-growth consumer/SOHO networking market. Charles Giancarlo, senior vice president of Switching, Voice and Carrier Systems, said the Linksys WLAN products do not overlap with its Aironet brand because the existing Cisco products are designed for business networks. Cisco plans to continue using the Linksys brand for its existing retail, distributor and e-commerce channels. The company noted that growth in the home networking market has been closely tracking growth in broadband penetration.
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- Linksys was founded in 1988 in Taiwan and now has its headquarters in Irvine, California. Linksys has 308 employees worldwide. It recorded $429 million in annual revenue for 2002. The company is led by Victor Tsao.
Earlier this month, Linksys announced the first shipment of a dual band 802.11 a+g product. The Linksys Wireless Dual Band A+G Wireless PC Card is available for a list price of $99. The card will communicate with all IEEE standardized products including 802.11a, 802.11b, 802.11g draft solutions. Linksys also plans to offer a Wireless A+G Router, A+G Access Point and PCI Adapter for desktop computers later this month.
In January 2003, Linksys rolled out a new line of full-featured Layer 2 and Layer 3 Ethernet and Gigabit Ethernet managed switches aimed at small to medium-sized businesses. Pricing starts at $500 for a Layer 3 Management 4-Port 10/100/1000 Gigabit Switch that provides 8 Gbps non-blocking switching performance and supports up to 256 port-based VLANs.
