Cisco in $50m partnersip with China’s CCS

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Cisco, the US technology group, has struck a deal to invest $50m in a Chinese telecoms services company.

Under the deal, Cisco will take a minority stake in China Communications Services Corporation, which was recently spun-off and taken public by some of China’s top telecoms groups, including China Telecom, China Mobile, and China Unicom.

Executives from Cisco and CCS will then team up to provide business customers in China with a suite of telecoms services, including digital video and 3G technology.

“China is an extremely important market for Cisco and, in co-operation with CCS, we intend to make China one of the most connected countries in the world,” said Owen Chan, senior vice-president of Cisco’s Asia-Pacific division.

Although Cisco has already invested some $700m in venture-backed deals in China, the CCS deal will mark the company’s largest direct investment in the rapidly-growing Asian nation.

At an analyst meeting this week in San Jose, California, John Chambers, Cisco chief executive, highlighted the importance of emerging markets to the company’s growth prospects over the coming years. He said that markets such as China and India could be just as profitable as the US, and that Cisco would be growing “aggressively” there.

Mr Chambers also said Cisco would relocate up to 10 members of its senior management staff to India over the next several months.

Cisco has also been moving to expand beyond its core business in data switches and routers by entering new business areas. New areas of focus include IP telephony, high-end teleconferencing, and other services that rely on data networks.

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