US technology company Cisco and Swedish networking company Ericsson have signed a deal to engage in the joint development of Internet of Things devices and sensors.
The two companies have signed a wide-ranging business and technology deal, which could generate an extra US$1 billion a year in sales for each company.
The deal includes a broad reseller agreement and collaboration in key emerging areas including the Internet of Things.
In addition, Ericsson and Cisco are currently working on a licensing agreement for their respective patent portfolios. Under the agreement, Ericsson will also receive license fees from Cisco.
Hans Vestberg, chief executive officer of Ericsson, said that the focus of the partnership will be IoT, enterprise customers and big telecoms companies.
Ericsson in Brazil 5G deployment
Ericsson is making in-roads into the global IoT market.
Last month the company announced it would further support Brazil’s digital agenda with the deployment of the first 5G test system in the country in 2016.
The 5G test system is purposed to support Brazil’s agenda to accelerate IoT innovation in various sectors, such as energy, agriculture, health care and education.
The test system will also focus on low battery consumption applications – low power sensors for remote areas for example.
The Swedish networking company said that the University of São Paulo, University of Campinas and Federal University of Ceará will also participate in 5G research and test activities.
Cisco also recently acquired German IoT analytics platform provider Parstream. ParStream produces an analytics database for Internet of Things environments, allowing companies to analyse large amounts of data and store it anywhere in the network.
Commenting on the acquisition, Cisco stated that the ParStream analytics database allows companies to store data at the edge of the network, closer to the source and track results across a distributed network.