The pact includes a joint marketing component that will allow Bay's gear, coupled with Ericsson's line of switches based on ATM (asynchronous transfer mode) technology, to be sold together through the Swedish giant's sales channel.
The duo is linking up to promote a new protocol called MPLS, or Multiprotocol Label Switching, which is currently making its way through the Internet Engineering Task Force toward standardization. Richard Pearce, director of business development for Bay's Internet/telecom business group, said prototype networks based on the technology could roll out "fairly soon," with ratification expected by the end of the year.
The MPLS protocol essentially allows packets of information to pass across high-speed network infrastructures based on ATM to network "edge" devices that might support ATM or another technology, such as Ethernet. Bay and Ericsson will use the protocol to enhance the capabilities of running IP (Internet Protocol) over ATM.
Current standards are not capable of handling high-end network tasks associated with service providers and communications carriers, according to Bay executives.
Pearce said Bay also will benefit because its gear, bundled with Ericsson's products, will be able to penetrate new markets, such as China, where the company previously has not held a strong presence.
The MPLS technology is an outgrowth of several proprietary mechanisms introduced by the likes of IBM and Cisco Systems so that advanced switching techniques could coexist with routing layouts, which make up the "backbone" of the Net.
"It gives us the ability to go to the customer with a total solution package," Ericsson spokesman Lars Ostlund said, noting that the company was running trials this summer and the product would be ready later this year.
Reuters contributed to this report.