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A flurry of service provider IT (SPIT) acquisitions involving Allot, WeDo and Acme Packet highlight some key industry trends

4G & Video Drive SPIT Acquisitions

Ray Le Maistre
5/2/2012
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Acquisition activity never seems far away from the Service Provider Information Technology (SPIT) sector and this week is no exception, with three takeover deals of note announced during the past few days.

Here are the highlights:

  • Deep packet inspection (DPI) specialist Allot Communications Ltd. (Nasdaq: ALLT) is to buy mobile video optimization system vendor Ortiva Wireless Inc. (See Allot Snaps Up Ortiva Wireless .)

    Video optimization is regarded as a key capability for operators looking for ways to avoid network congestion and keep customer satisfaction levels high, so Allot is certainly buying into a growth sector.

    The price was undisclosed, but, as Azi Ronen, of the Broadband Traffic Management blog, spotted during Allot's earnings conference call, it appears to be less than $16.5 million.

    Allot's move could have an impact on one of its DPI rivals, Procera Networks Inc. (Nasdaq: PKT), which has teamed up with Ortiva on a few occasions and which has recently raised some cash so it can make acquisitions of its own. (See Procera Builds M&A War Chest.)

    So will Allot's plans affect Procera? "This acquisition will not have a material effect on Procera or any of our customers," noted CEO Jim Brear in an emailed response to questions. "We are very familiar with video optimization, and have partnerships and deployments with multiple vendors in this space," he added.

    You can hear more from Brear on this podcast conducted by Light Reading's head of customer care despair, Phil Harvey. (See Procera's Jim Brear: Waiting for Personalized Services.)

  • Revenue assurance firm WeDo Technologies has bought network expense management specialist Connectiv Solutions to give it a presence in the key North American market.

    WeDo does a good job of explaining the rationale for the acquisition in its press release, WeDo Acquires Connectiv Solutions.)

    Additionally, the company's CEO, Pink Floyd fan Rui Paiva, noted that WeDo harbored ambitions to be "a major player in the revenue assurance and fraud management space in North America both on SaaS and Managed Services business models; this deal with Connectiv Solutions enables us to realize these ambitions." Cool beans! (See EuroProfile: WeDo Technologies.)

    This looks like a good time to get into the U.S. market for WeDo, as revenue assurance is going to become a critical issue for LTE operators, of which there are already a number in North America. (See LTE Could Add to Leakage Woes.)

  • Acme Packet Inc. (Nasdaq: APKT) has splashed $21 million on IP network management specialist Iptego GmbH. (See Acme Packet Acquires Iptego.)

    Iptego's software allows operators to monitor what's happening in their IP networks and how applications and customers are being affected. Network operators have needed these tools for a long time, of course, but such capabilities are becoming increasingly important as networks migrate to all-IP environments and as service providers focus increasingly on customer experience management (CEM).

    Acme is in a great position to integrate Iptego's software into its existing session border controller and other products, which are already deployed by more than 1,600 customers.

    What's also interesting is that Iptego's software uses SIP and Diameter signaling to manage IP network elements. Acme has long been a SIP specialist but is also now keen to develop its Diameter capabilities, which are going to be critical to mobile data service providers (enhanced 3G and 4G). Acme is already a player in the Diameter system market, having launched its Policy Exchange Controller product last year. (See Acme Unveils Policy Exchange Controller for LTE.)

    — Ray Le Maistre, International Managing Editor, Light Reading

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