& cplSiteName &

Is Acme a Virtual Gain for Oracle?

Ray Le Maistre
2/4/2013
50%
50%

Oracle Corp.'s plan to acquire session border controller (SBC) specialist Acme Packet Inc. looks like a way for the software giant to get some ready-made smarts in the key telco sectors of 4G packet core networking and network functions virtualization (NFV), according to industry analysts. (See Oracle to Acquire Acme for $1.7B.)

But the move, which is yet another example of encroachment by a major IT company into traditional telecom turf, will also shake up the competitive environment and put some industry relationships under strain, says the experts.

Packet core competencies
As mobile operators migrate toward the all-IP networking environments of 4G/LTE, so the capabilities they need in the intelligent core of their networks (where voice and data traffic is identified, analyzed and managed) are changing. Acme Packet has some of the key technologies mobile operators will need in their all-IP architectures, especially as traditional circuit-switched voice traffic disappears and mobile "calls" become real-time packet interactions.

"Acme Packet is well positioned in real-time IP-based communication services," says Heavy Reading senior analyst Gabriel Brown. "On the mobile side, it has a big opportunity in IMS-based Voice over LTE [VoLTE or 4G Voice], and that is only one of several potentially large markets for real-time services."

Brown notes that Oracle believes Acme Packet's potential spreads far beyond the telecom sector. The acquisition announcement "talks about healthcare, security, and commerce, so clearly Oracle sees Acme's technology as being applicable to a broad range of applications and markets. [Acme] also has a decent play in so-called Operator OTT [over-the-top service management], should that emerge as a significant source of revenue," he adds. "Oracle has, for some time, wanted a bigger presence in the 4G core, so the deal fits on that score. Buying a segment market leader has much to recommend it."

Let's get virtual
Acme Packet is also one of the IP networking specialists that has been exploring ways in which its products can be offered as software and integrated into networks that, in common parlance, are "software-defined" or "virtualized."

"Acme Packet is further along in virtualizing its 4G core products than many other vendors," notes Heavy Reading's Brown. "It'll be interesting to see how Oracle drives this idea of software-centric networking and hardware independence, as is being pursued across the industry in the Network Functions Virtualization [NFV] work." (See Carriers Peer Into Virtual World.)

Brown's Heavy Reading colleague, Ari Banerjee, agrees that the deal gives Oracle opportunities in the NFV space. "This will enhance Oracle's SDP [service delivery platform] strategy and allow it to jump into SDN" as it will be able to house "Acme Packet technology on Sun platforms in a virtualized hypervisor environment."

Positive for Acme, a natural step for Oracle
Infonetics Research Inc. principal analyst Diane Myers believes this is a good time for Acme Packet to find a new home. "The competition for session border controllers within the service provider and enterprise space has been heating up and being a standalone product specialist becomes more challenging," she states.

And it makes sense for Oracle, though it alters the industry dynamics somewhat, notes Myers. Buying a network vendor "is a natural extension of [Oracle's] work on the service delivery layer. It will, however, put it in closer competition with many of its network partners. It was expected that Oracle would make a push into network equipment at some point in 2013."

Competitive tension
That potential for competitive tension is exacerbated by the growing interest among major communication service providers in virtualization, but it's also a good way for Oracle to kick back at the networking giants such as Cisco Systems Inc. and Ericsson AB that are invading the IT space and making big noises in the NFV and SDN arenas, believes Heavy Reading's Caroline Chappell.

"This is the start of the fight-back of the IT vendors against Cisco et al moving into the Service Provider Information Technology (SPIT) space with cloud management and OSS acquisitions and talking about becoming software and services companies." (See Cisco Extends Its SDN & Cloud Plans and Ericsson to Buy Telcordia.)

Chappell adds: "The network equipment providers were scenting the advantage [in virtualized networks] as NFV requires deep knowledge of the network, but Oracle is beginning to even up the playing field by buying a heavyweight networking company and it's also one that strengthens its SIP server, charging and policy control business," she notes.

Having a foot in both the networks and SPIT camps is a must for major vendors now, notes Ovum Ltd. principal analyst Dana Cooperson in emailed comments issued to trade journalists. "Telecom and IT are coming together in ways that are shifting the vendor competitive framework significantly. ... Companies that specialize in either telecom or IT will need a strategy of how they will benefit from this blending of what were two largely separate domains. Any vendor that wants to be a full-service partner to the telcos and other large communications and content providers will need such a blended strategy to be credible. Specialists will need to align with full-service partners."

And Cooperson expects further strategic acquisitions. "Oracle has a comparatively large bucket of cash to use for acquisitions," with only Cisco among the infrastructure vendors boasting greater M&A muscle, she notes. "Oracle and Cisco can both afford to be aggressive with M&A whereas many of their peers cannot. Expect the buying spree to continue."

-- Ray Le Maistre, International Managing Editor, Light Reading

(2)  | 
Comment  | 
Print  | 
Newest First  |  Oldest First  |  Threaded View        ADD A COMMENT
victorblake
50%
50%
victorblake,
User Rank: Lightning
2/5/2013 | 3:28:06 PM
re: Is Acme a Virtual Gain for Oracle?
Train engine (Acme) meet passenger car (Oracle); passenger car -- meet train. I think you two go well together. When the transport technology (IP and below) matures to the point it has, the new traffic cops are application routers, of which Acme's product is a pre-eminent example. Huge synergies are possible. I'm sure most of the other telecom system vendors won't like it though.

Moves like this are likely to force another major player (at some point in the future) to take MySQL and build a system product and services around it in the same way that Red Hat (and perhaps others) have for Linux.

I wouldn't be surprised to see Cisco Systems some day take the plunge into big data and the cloud by building or acquiring a layered product and services on top of MySQL to compete.
Ray Le Maistre
50%
50%
Ray Le Maistre,
User Rank: Light Sabre
2/5/2013 | 2:35:42 PM
re: Is Acme a Virtual Gain for Oracle?
There's another intriguing angle identified by my friends at BillingViews, that this deal could be part of Oracle's telecom Big Data efforts -- the raw data that could be extracted from SBCs and Diameter signalling routers and utilized by analytics engines could prove valuable to Oracle.-á

Check out-áhttp://www.billingviews.com/or...-á-á
Light Reading’s Upskill U is a FREE, interactive, online educational resource that delivers must-have education on themes that relate to the overall business transformation taking place in the communications industry.
NEXT COURSE
Wednesday, July 27, 1:00PM EDT
The Changing Face of the Data Center World
Rodney M. Elder, Senior Solutions Architect, Equinix
UPCOMING COURSE SCHEDULE
Wednesday, August 3, 1:00PM EDT
The Central Office Re-Architected as a Data Center
Guru Parulkar, Executive Director, Open Networking Research Center, Open Networking Lab
Wednesday, August 10, 1:00PM EDT
Telcos & Open Source 101
Phil Robb, Senior Technical Director, OpenDaylight
Friday, August 12, 1:00PM EDT
The Role of Open Source in NFV
Jim Fagan, Director, Cloud Practice, Telstra
in association with:
From The Founder
In the first episode of a four-part series, Light Reading Founder and CEO Steve Saunders and Calix President and CEO Carl Russo drive around town discussing the disruptive mega-changes in the communications industry and where hope lies for service providers to meet the escalating demands of the cloud.
Flash Poll
Live Streaming Video
Charting the CSP's Future
Six different communications service providers join to debate their visions of the future CSP, following a landmark presentation from AT&T on its massive virtualization efforts and a look back on where the telecom industry has been and where it's going from two industry veterans.
Telecom Innovators Video Showcase
VeEX Test & Measurement Solutions

7|25|16   |   08:57   |   (0) comments


Cyrille Morelle, president and CEO of VeEX Inc., talks test and measurement with Light Reading's Steve Saunders at BCE 2016. This includes innovative products such as VeSion Cloud-Based platform for network monitoring; MTTplus Modular Test platform for Access, Business, Carrier Ethernet, Transport and Core services; and OPX-BOX+ for Fiber Optics.
LRTV Custom TV
VeEX: Live From BCE 2016

7|25|16   |   03:20   |   (0) comments


VeEX's Senior Director of Business Development, Perry Romano, explains how VeEX provides tools to help install, maintain, monitor and manage network infrastructure efficiently and effectively. The portfolio of products on display include the RXT-6000, MTTplus and TX300s.
LRTV Custom TV
Real-Time Telemetry & Analytics for Intelligent SDN Orchestration

7|25|16   |   03:09   |   (0) comments


Packet Design CEO Scott Sherwood discusses how real-time network telemetry and analytics are enabling a new breed of SDN orchestration applications.
From the Founder
The Russo Report: Driving Disruption

7|25|16   |   07:44   |   (0) comments


In the first episode of a four-part series, Light Reading Founder and CEO Steve Saunders and Calix President and CEO Carl Russo drive around town discussing the disruptive mega-changes in the communications industry and where hope lies for service providers to meet the escalating demands of the cloud.
LRTV Custom TV
NetScout: Maximizing Enterprise Cloud for Digital Transformation

7|20|16   |   04:53   |   (0) comments


Light Reading Editor Mitch Wagner talks to NetScout CMO Jim McNiel about maximizing the benefits of enterprise cloud and digital transformation while minimizing potential pitfalls with a proper monitoring and instrumentation strategy.
Women in Comms Introduction Videos
Ciena's VP Offers a Career Crash Course

7|20|16   |   4:14   |   (0) comments


How did Ciena's Vice President of Sales, Angela Finn, carve out her career path? Simple, she tells WiC. She stayed true to her company, customers and principles. She shares her advice for women on how to be authentic and credible, as well as for companies that want to make a real change to their culture and practices.
LRTV Custom TV
NFV in 2016: Part 2 – Climbing the Virtualization Maturity Curve

7|19|16   |   06:56   |   (0) comments


Many of the initial use case implementations are single-vendor and self-contained. The industry is still climbing the virtualization maturity curve, needing further clarity and stability in the NFV infrastructure (NFVi) and greater availability and choice of virtualized network functions (VNFs). Interoperability between NFVis and VNFs from different vendors ...
Telecom Innovators Video Showcase
Versa Networks' Kumar Mehta on SD-WAN Managed Services

7|19|16   |     |   (0) comments


In Silicon Valley, Steve Saunders sits down with Versa's Kumar Mehta for an interview focused on why service providers are building SD-WAN managed services, and how Versa's telco customers are innovating.
LRTV Custom TV
Juniper Networks & The Evolution of NFV

7|19|16   |   06:01   |   (0) comments


Senior Juniper Networks executives talk to Light Reading Founder & CEO Steve Saunders about NFV developments and the recent independent evaluation by test lab EANTC of Juniper's Cloud CPE solution.
LRTV Interviews
CenturyLink Goes Beyond Managed WiFi

7|19|16   |     |   (0) comments


CenturyLink's managed WiFi allows enterprises, such as retailers and resorts, to track guest WiFi usage in order to help them better communicate with customers.
LRTV Interviews
AT&T Launches Network Functions on Demand

7|17|16   |   05:26   |   (0) comments


Roman Pacewicz, Senior Vice President, Offer Management & Service Integration, AT&T Business Solutions, discusses the operator's launch of its Network Functions on Demand service.
LRTV Interviews
Enterprise Pitch for Ciscosson

7|14|16   |   04:43   |   (0) comments


After seven months of near silence, Cisco and Ericsson executives publicly discussed details on their extensive partnership. Among the tidbits shared by Martin Zander, VP, group strategy programs, Ericsson, and Doug Webster, VP service provider marketing, Cisco: The partnership was initially launched to serve the service provider market, but is already gaining ...
Upcoming Live Events
September 13-14, 2016, The Curtis Hotel, Denver, CO
September 27, 2016, Philadelphia, PA
November 3, 2016, The Montcalm Marble Arch, London
November 30, 2016, The Westin Times Square, New York City
December 6-8, 2016,
May 16-17, 2017, Austin Convention Center, Austin, TX
All Upcoming Live Events
Infographics
Five of the Top 10 most targeted countries in Check Point Software Technologies' global Malware & Threat Index for Q1 2016 are in Africa.
Hot Topics
Kevin Lo's Move to Facebook: Sign of Things to Come?
Patrick Donegan, Chief Analyst, Heavy Reading, 7/20/2016
Verizon's Next With VNFs
Carol Wilson, Editor-at-large, 7/21/2016
Facebook Gets Its Drone On
Ray Le Maistre, Editor-in-chief, 7/22/2016
Ericsson Ejects CEO Vestberg
Ray Le Maistre, Editor-in-chief, 7/25/2016
Is Dish Going Down the Drain?
Alan Breznick, Cable/Video Practice Leader, Light Reading, 7/21/2016
Like Us on Facebook
Twitter Feed
BETWEEN THE CEOs - Executive Interviews
There's no question that, come 2020, 5G technology will turn the world's conception of what mobile networking is on its head. Within the world of 5G development, Dr. ...
I've enjoyed interviewing many interesting people since I rejoined Light Reading, but William A. "Bill" Owens certainly takes the biscuit, as we say where I come from.
Animals with Phones
Live Digital Audio

Our world has evolved through innovation from the Industrial Revolution of the 1740s to the information age, and it is now entering the Fourth Industrial Revolution, driven by technology. Technology is driving a paradigm shift in the way digital solutions deliver a connected world, changing the way we live, communicate and provide solutions. It can have a powerful impact on how we tackle some of the world’s most pressing problems. In this radio show, Caroline Dowling, President of Communications Infrastructure & Enterprise Computing at Flex, will join Women in Comms Director Sarah Thomas to discuss the impact technology has on society and how it can be a game-changer across the globe; improving lives and creating a smarter world. Dowling, a Cork, Ireland, native and graduate of Harvard Business School's Advanced Management Program, will also discuss her experience managing an international team focused on innovation in an age of high-speed change.