Cisco Systems has agreed to buy software developer P-Cube in a cash-and-options deal Cisco valued at $200m (?110m).
P-Cube makes software to help service providers analyse and control network traffic.
Cisco plans to continue selling P-Cube's software as stand-alone products for the foreseeable future. It will also work on incorporating the technology into its hardware and software, said Pankaj Patel, general manager of Cisco's broadband edge and mid-range routing business unit.
Patel estimates it will be at least nine months before Cisco completes its software integration, and a year before its hardware is integrated with P-Cube's technology.
Cisco hopes to use the technology to encourage providers to offer more advanced services, such as voice over IP, gaming, video on demand and peer-to-peer offerings. Such services can be monitored and metered with P-Cube's software.
Five-year-old P-Cube has 118 employees, the majority of whom will be offered positions at Cisco, according to a Cisco spokesman, told ComputerWeekly.
CISCO Systems agreed to acquire closely held internet protocol service provider P-Cube for $US200 million ($281 million) in cash and options.
The move boosts Cisco's capacity for the fast-growing Voice-over-IP internet telephony market as well as other services such as interactive gaming, video-on-demand, and peer-to-peer technology.
P-Cube helps internet service providers identify subscribers, classify applications, improve service performance, and charge for multiple IP services without adding infrastructure.
Cisco is the world's largest manufacturer of networking equipment to facilitate the transfer of data across the internet, reports Agence France-Presse.
The company says that its IP service control technology allows networks to differentiate between services such as video-on-demand, Web browsing, email, music streaming, VoIP and P2P traffic while "guaranteeing performance and enabling new business models".
P-Cube's Service Control software gives operators application-level control of existing IP transport networks, which, according to Cisco, will enable service providers to analyse, control and meter application and content-based services.
The deal is expected to close in Cisco's first financial quarter next year. The P-Cube management team will report to Pankaj Patel, vice president and general manager of Cisco's Broadband Edge and Midrange Routing Business Unit.
According to its Web Site, P-Cube was founded to help mobile and wire-line IP service providers, "optimise overall network investments and enable compelling content-based services", writes ZDNet UK.