Cisco’s plans to acquire Jasper Technologies for $1.4 billion will test the limits of its new partnership with Ericsson.

Cisco and Jasper said they aimed to help telcos accelerate their move into the M2M/IoT space when announcing the deal on Wednesday night.

Jasper powers the M2M/IoT businesses of 27 network operator groups and is the platform on which the M2M World Alliance consortium is based around.

It also has 3,500 enterprise customers that use its technology.

Cisco said the acquisition would enable it to offer a complete IoT solution that is interoperable across devices.

Jasper CEO Jahangir Mohammed will run a new IoT Software Business Unit under Rowan Trollope, Cisco Senior Vice President and General Manager, IoT and Collaboration Technology Group.

Cisco promised to add new IoT services, such as enterprise Wi-Fi, security for connected devices, and advanced analytics, to Jasper’s portfolio.

But the acquisition, which is expected to close in the third quarter, raises questions about the partnership agreement Cisco signed with Ericsson last November.

According to Machina Research, Jasper’s Control Center and Ericsson’s Device Connection Platform “fulfil almost identical purposes”.

It said: “The deal does sit strangely with the collaboration with Ericsson over DCP.

“We will watch with interest how the two organisations square this obvious overlap in offerings.

“If the nascent alliance is to thrive in this area Cisco and Ericsson will need to find different focuses for the two products.”

An Ericsson spokesperson told European Communications that the tie-up between the two companies was based around the areas in which they complement each other.

The acquisition of Jasper means that Cisco and Ericssson will be compete in other areas, the spokesperson added.

[Read more: Cisco still a rival despite deal, says Ericsson]

CEO Chuck Robbins said: “I am excited about the opportunity for Cisco and Jasper to accelerate how customers recognise the value of the Internet of Things.

“Together, we can enable service providers, enterprises and the broader ecosystem to connect, automate, manage, and analyze billions of connected things, across any network, creating new revenue streams and opportunities.”

Mohammed added: “IoT has become a business imperative across the globe.

“By coming together, Jasper and Cisco will help mobile operators and enterprises accelerate their IoT success.” 

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