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Cisco takes bait: Airespace is the hook. What about Trapeze? Aruba?

By hook or by crook, as the shepherds used to say: Cisco intends to dominate networking, and if it can't develop a winner internally - as it failed to do in wireless LANs with CCX - then it will buy it. And the rumours are, it will be Airespace it buys, not Trapeze, nor Aruba.

Some will be surprised. Several cynical consultants looked at "centrally managed" corporate WLAN startups like Airespace and Trapeze two years ago, and described them as "corporations without a business plan, designed to be bought by Cisco" - a slur which grievously upset both Trapeze and Airespace at the time.

The surprise would also be for those who felt that Airespace had got lift-off, and enough air-speed to escape the long tongue of the takeover. Those who are surprised, would include one or two founders at Airespace, who really really wanted to build a corporation, not become part of the Cisco Empire, and thought they were big enough to stand alone.

The rumour, first revealed today by CNET values Airespace at $500m tops which the commentator describes as a nice price for a $60m a year startup. Actually, some analysts think this is a bargain for a corporation that has such good visibility, and say Airespace is probably worth a lot more than 12X earnings.

For Airespace, the acquisition isn't quite as bad as a Microsoft buyout, which all too often goes the way of a Symantec or Computer Associates takeover - that's the last you ever hear of the technology, which gets milked for its subscriber revenues, and never updated. Cisco has something of a reputation of putting the founders of subsidiary outfits to the galley benches and making them keep paddling.

But the bottom line is that either Aruba or Trapeze, with Cisco behind them, could have stolen Airespace's market potential. It pretty much had to settle; its backers wouldn't have carried on backing it against Cisco if Cisco had credible rival technology, and both those companies do have credible technology.