Linksys Acquires DSL Software Vendor

The integration of broadband gateways into home networking is jumping forward with an acquisition set to be announced by Cisco Systems’ Linksys division on Tuesday.

Linksys is to acquire the intellectual property and selected assets of Ashley Laurent, a provider of software primarily for DSL gateway devices. The eight employees of the Austin, Texas, company will join the Home Networking Business Unit of Linksys and move to a Cisco office in Austin, said Malachy Moynihan, vice president and general manager of the business unit. Terms of the deal were not disclosed.

Ashley Laurent develops embedded software for functions such as routing, firewalling, quality of service and virus protection in the increasingly sophisticated modems that bring broadband service into homes. Its customers include system makers such as 3Com and D-Link, as well as chip makers Texas Instruments and Advanced Micro Devices.

Linksys has been outsourcing much of its software development to companies including Ashley Laurent, but it plans to bring more of that work in-house through Tuesday’s purchase. Linksys sees a growing opportunity to integrate special features for voice over IP (VoIP) and multimedia into gateways, Moynihan said. Linksys has not been a big player in the gateway industry, but the company sees the devices being combined with the wireless-equipped routers that have been a mainstay of its business. More sophisticated gateways could help the carriers capitalize on lucrative new services, he said.

As broadband evolves from primarily a Web-browsing tool into a “triple-play” or “quad-play” service that may include TV, telephone, data and mobile services, the box where the carrier’s service hits the home network is likely to play a growing role. The Linksys acquisition follows a Motorola investment in Ruckus Wireless, announced on Monday. The Sunnyvale, Calif., startup makes wireless LAN devices with special features for sending streaming video around a home and sees Motorola possibly integrating that gear into some IP-based cable set-top boxes.

One thing Linksys wants to get out of the Ashley Laurent acquisition is greater consistency across different gateway devices. Some carriers provide the boxes themselves, but Linksys wants more consumers to be able to buy gateways at retail that will work smoothly with their carriers’ services, Moynihan said. DSL devices have lacked the solid standards used in cable modems, he said.

Linksys will also aim for consistency among the software in its gateways and in the other devices it supplies around the home, such as networking adapters for TVs. Consistent software could enable special capabilities, he said. The products would still comply with standards and work with other vendors’ products at a basic level, Moynihan said.

However, other vendors that have been using Ashley Laurent software will be left out in the cold. The company will fulfill existing contracts with other vendors, but development on future products for them will end, Moynihan said. In addition to 3Com and D-Link, Ashley Laurent customers in the fiercely competitive networking business include NetGear, Telefonaktiebolaget LM Ericsson LM Ericsson, Accton Technology and LG Electronics.

-Stephen Lawson, IDG News Service (San Francisco Bureau)