LANcity buy bumps Bay into cable >BY Shira McCarthy, Associate Editor-News

Bay Networks announced plans last week to acquire cable modem manufacturer LANcity Corp., marking the company's latest move in a long-term strategy of staking a claim in the access market.

The $59 million buyout will make Bay Networks the first company to offer cable operators an end-to-end data internetworking solution, and it gives Bay a gateway to the rapidly growing data-over-cable industry.

"The LANcity acquisition clearly fits with Bay Networks' recent efforts to enter the service provider supplier end of the market," said Rosemary Cochran, principal at Vertical Systems, Dedham, Mass. "This is one of the pieces of Bay's new focus on the Internet, since carriers are looking at the cable TV infrastructure as an attractive way to offer high-speed access to the Internet."

LANcity will operate as a division within Bay's recently created Internet/telecom business unit, and LANcity Founder and Chief Executive Officer Rouzbeh Yassini will act as vice president and general manager of cable access, said Bruce Sachs, executive vice president of the division.

"Together, Bay Networks and LANcity intend to be leaders in the data-over-cable industry," Sachs said. "We plan on aggressively working on integrating our product lines to drive down the cost of deploying a [data-over-cable] network." The acquisition is expected to be completed by the end of the month.