November 17, 2003 1:55 PM PST

3Com and Huawei start China venture

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3Com and Huawei Technologies said Monday that they've begun operating a joint venture, selling networking equipment to businesses in the lucrative China market.

The partnership is expected to provide new competition for Cisco Systems, which is among the leaders in the Chinese market for networking equipment telephone companies and other businesses use. Huawei is known for selling routers and switches significantly less expensive than Cisco's.

"3Com intends to fundamentally change the playing field in the enterprise networking industry," Bruce Claflin, 3Com's president and chief executive officer and the chairman of the Huawei-3Com venture, said in a statement.

A phone call to Cisco Systems Monday seeking comment was not immediately returned.

Cisco Systems chief executive John Chambers recently told financial analysts that sales of Cisco equipment booked by businesses in the Asia Pacific region were up 11 percent during Cisco's first financial quarter. Sales in China during that quarter saw "usually positive seasonality," Chambers added.

Monday's announcement comes despite Cisco Systems' filing of a lawsuit against Huawei for allegedly copying vast amounts of Cisco's operating system for routers. Huawei was even accused of distributing some user manuals that appeared to be exact copies of Cisco manuals. The two companies have since ended the litigation following Huawei's announcement that it would make changes to the products named in the lawsuit.

 

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