Light Reading
Analysts believe Acme Packet will give Oracle some street smarts in the mobile packet core and network functions virtualization/software-defined networking sectors

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
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.-

Check out-http://www.billingviews.com/or...--
Flash Poll
From The Founder
It's clear to me that the communications industry is divided into two types of people, and only one is living in the real world.
LRTV Custom TV
Using Service Quality to Drive WiFi Monetization

10|22|14   |   6:51   |   (0) comments


Live from the SCTE conference: Heavy Reading's Alan Breznick explores the forces shaping the WiFi opportunity in an interview with CableLabs' Justin Colwell and Amdocs' Ken Roulier.
LRTV Custom TV
Distributed Access Architectures – 2

10|21|14   |   8:51:00 AM   |   (0) comments


ARRIS CTO Network Solutions Tom Cloonan discusses why many if not most MSOs will continue with integrated CCAP, while addressing why some are also looking at two futuristic, distributed access architectures: Remote PHY and Remote CCAP.
LRTV Custom TV
Distributed Access Architectures – 1

10|21|14   |   9:01   |   (0) comments


SCTE Sr. Director of Engineering Dean Stoneback discusses the pros and cons of distributed access architecture (DAA) and its various forms, which range from basic Remote PHY to full CMTS functionality in the node.
LRTV Custom TV
The WiFi Road to Riches – 2

10|21|14   |   3:58   |   (0) comments


ARRIS Senior Solution Architect Eli Baruch talks about how MSOs can enable public and community WiFi through 1) outdoor access points, 2) businesses seeking to offer WiFi to customers, and 3) residential WiFi gateway extensions.
LRTV Custom TV
The WiFi Road to Riches – 1

10|21|14   |   10:15   |   (0) comments


SCTE Director of Advanced Technologies Steve Harris discusses WiFi deployments, drivers, challenges and advances, including 802.11ac, carrier-grade WiFi, community WiFi, Hotspot 2.0, Passpoint, WiFi-First and voice-over-WiFi.
LRTV Custom TV
Advantech Accelerates 100G Traffic Handling

10|17|14   |   7:56   |   (0) comments


Paul Stevens from Advantech explains why handling 100GbE needs a whole new platform design approach and how Advantech is addressing the needs of equipment providers and carriers to give them the flexibility and performance they will need for SDN and NFV deployment.
LRTV Huawei Video Resource Center
Holland's Imtech Traffic & Infra Discusses Huawei's ICT Solution and Services

10|16|14   |   4:49   |   (0) comments


Dimitry Theebe is from the business unit at Imtech Traffic & Infra which delivers communications solutions for transportations. His partnershp with Huawei began about a years ago. In this video, Theebe speaks more about this partnership and what he hopes to accomplish with Huawei.
LRTV Huawei Video Resource Center
Huawei's Comprehensive Storage Solutions Vital for SVR

10|16|14   |   6:16   |   (0) comments


SVR Information Technology provides cloud services for academic and special sectors. With Huawei's support, SVR and Yildiz Technical University has established Turkey's largest and most advanced High Performance Computing system. CSO Ismail Cem Aslan talks about what he hopes Huawei's OceanStor storage system will bring for him.
LRTV Huawei Video Resource Center
Mexico's Servitron's Impression of Huawei at CCW 2014

10|16|14   |   6:35   |   (0) comments


Servitron is a network operator in Mexico that has been in the trunking industry for the past 20 years. Its COO, Ing. Ragnar Trillo O., explains at Critical Communications World 2014 that his company has been interested in the long-term evolution of LTE technology and its adoption for TETRA.
LRTV Huawei Video Resource Center
Building a Better Dubai

10|16|14   |   2:06   |   (0) comments


Abdulla Ahmed Al Falasi is the director of commercial affairs, a telecommunications coordinator for the government of Dubai. Their areas of service span across multiple industries, including police, safety, shopping malls and more. In this video, Abdulla talks about his department's work with Huawei.
LRTV Huawei Video Resource Center
Huawei Lights Up Malaysia Partner Maju Nusa

10|16|14   |   1:59   |   (0) comments


Malaysia's Maju Nusa is an enterprise partner to Huawei in networking, route switches and telco equipment. At this year's Critical Communications World in Singapore, CTO Pushpender Singh talks about what Huawei's eLTE solutions mean to his company and for Malaysia.
LRTV Custom TV
Evolving From HFC to FTTH Networks

10|15|14   |   2:19   |   (0) comments


Cisco's Todd McCrum delves into the future of cable's HFC plant, examining how DOCSIS 3.1 and advanced video compression will extend its life and how the IP video transition will usher in GPON and EPON over FTTH.
Upcoming Live Events
October 29, 2014, New York City
November 6, 2014, Santa Clara
November 11, 2014, Atlanta, GA
December 2, 2014, New York City
December 3, 2014, New York City
December 9-10, 2014, Reykjavik, Iceland
February 10, 2015, Atlanta, GA
June 9-10, 2015, Chicago, IL
Infographics
WhoIsHostingThis.com presents six of the world's most extreme WiFi hotspots, enabling the most epic selfies you can imagine.
Hot Topics
Analysts Warn of Major NFV Gaps
Carol Wilson, Editor-at-large, 10/22/2014
Is Health the Killer App for the IoT?
Jason Meyers, Senior Editor, Gigabit Cities/IoT, 10/22/2014
iPad Air 2 Lets Users Switch Carriers Any Time
Mitch Wagner, West Coast Bureau Chief, Light Reading, 10/17/2014
NYC Subway Wireless No Cure for Ebola Fears
Dan Jones, Mobile Editor, 10/16/2014
The Human Gain of the Smart Home
Robin Mersh, 10/20/2014
Like Us on Facebook
Twitter Feed