Cisco bought a minority stake in Monterey Networks, a startup maker of gear that uses optical technology to route data on phone networks.
Richardson, Texas-based Monterey has about 70 employees. Its equipment can move more data faster than
existing data networking switches, which use traditional electronics rather than the light beams used in optical
gear. Financial terms weren't disclosed.
Cisco and rivals Lucent Technologies and Nortel Networks are racing to make or buy equipment that uses optical technology called dense wavelength division
multiplexing to connect the switches that run the Internet. Cisco and DWDM-
maker Ciena last year said they would develop the speedy equipment, yet haven't
unveiled any new products.
"Cisco has got to own this stuff eventually," said Craig Johnson, principal analyst
with market research firm Pita Group.
Monterey's product, called a wavelength router, is expected to ship in late 1999.
Graeme Fraser, vice president and general manager of Cisco's Optical
Internetworking unit, was named to Monterey's board.
Cisco chief executive John Chambers said on April 15 that his company will buy
more Texas-based companies as part of plans to expand its U.S. research and
development centers.
Ciena in March bought Lightera Networks, a rival of Monterey, for $463.5 million.
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