Fujitsu, Cisco Form Development Alliance

The alliance will take advantage of San Jose, Calif.-based Cisco's leadership in Internet protocol technology and Tokyo-based Fujitsu's edge in networking products. The companies will be able to provide better quality products to telecommunication service providers more quickly, both sides said in a statement.

The companies will work together to develop router operating systems for Japanese providers, and Fujitsu will offer routing products under a joint Fujitsu and Cisco brand, with the first product expected in spring 2005.

"Partnering is a strategic imperative for companies such as Cisco and Fujitsu," said Mike Volpi, senior vice president of Cisco's Routing Technology Group, adding that Japan is one of the leading nations in the world in broadband.

"In the future I believe Internet business models will come from Japan," he said.

Fujitsu, which earns about 40 billion yen ($392 million) in revenue from routers and switches, hopes to increase that to 60 billion yen ($588 million) in three years.

Cisco, which has about 60 percent of Japan's 400 billion yen ($3.9 billion) market in routers and switches, said the alliance with Fujitsu will help the company to secure 70 percent of the market share.

In Japan, more companies are shifting to Internet protocol-based networks.

Copyright © 2004 The Associated Press. All rights reserved. The information contained in the AP News report may not be published, broadcast, rewritten or redistributed without the prior written authority of The Associated Press.