Xros won't even launch its technology for tests until this summer. The moves are indicative of a growing arms race in the networking industry as competitors build and acquire the components necessary to build faster networks for high-end communications companies. Traditionally, optical signals needed to be converted to electrical signals first. But Xros has developed technology that obviates this step. Lucent is in the process of developing similar equipment.
Swiftness is of the essence in the high-end networking industry.
The competition has spawned deals that may not appear, at first glance, to make much sense. However overvalued, these acquisitions exemplify a growing sense among networking firms that speed to market is worth a few billion here and there. And Nortel is jumping right into the fray. Cisco has been known as the expert in acquiring companies in the networking industry. But with rampant opportunity proving to be too much for even the largest firms like Nortel and Lucent, everyone is getting into the act.