& cplSiteName &

RACO Uses M&A to Beef Up Its M2M Play

Sarah Thomas
7/16/2013
50%
50%

Machine-to-machine (M2M) communications connectivity provider RACO Wireless has closed its acquisition of GPS tracking software maker Position Logic, the companies announced Wednesday. This is one of several buys RACO has planned as it looks to beef up its presence in the M2M market via M&A.

The merger will combine Position Logic's GPS tracking app with RACO's access to CDMA and GSM networks across the globe. RACO President John Horn says the company brings 400 new customers to RACO's base of 1,000, with only five overlapping. Financial terms of the deal weren't disclosed.

This acquisition is all part of RACO's strategy to be the easiest to do business with, Horn says. But, it's also part of its strategy to grow through M&A, easing fragmentation in the M2M space and giving companies a reason to look outside the big four U.S. wireless operators, even as all four step up their focus on connected devices.

RACO took over all of T-Mobile's M2M business in 2011 when AT&T's acquisition of the carrier appeared eminent. Since then, T-Mobile got back in the game on its own, and RACO has partnered up with many other wireless operators, acting as an MVNO over their networks and offering enterprises access to several. (See T-Mobile Outsources its M2M Strategy) and T-Mobile's Back in the M2M Business).

At the same time, however, the big operators, which are keenly interested in M2M, have been its main competition. Horn dismisses the threat of competition, noting that the carriers can't meet the needs of all the potential customers out there and won't play nice with each other anyway, making them unattractive to companies that can't rely on just one network technology.

Even so, RACO is doing what it can to shore up its defenses. Since a major investment by private equity firm Iverness Graham in October, it has been working on competing by acquiring companies that augment its business, add new capabilities and eventually those that compete with it.

"The market is fragmented and will be for awhile yet," Horn says. "We're one of the key players that's solving it by bringing multiple carriers under one platform. We'll do what we can to bring in more value. There will be more consolidation, and we'll facilitate that."

Horn says to expect RACO to acquire at least one more company relatively soon. He's not ruling out the possibility of RACO becoming an acquisition target either, perhaps by one of its big operator partners.

"We will build a large successful company with a large amount of scale," Horn says. "Who knows what the next step will be beyond that. To say that we will never be acquired is an unrealistic, but we're not in it to flip the business."

— Sarah Reedy, Senior Editor, Light Reading

(1)  | 
Comment  | 
Print  | 
Newest First  |  Oldest First  |  Threaded View        ADD A COMMENT
Sarah Thomas
50%
50%
Sarah Thomas,
User Rank: Blogger
7/17/2013 | 3:19:44 PM
re: RACO Uses M&A to Beef Up Its M2M Play
If you were a company that is tracking packages or drivers across the country, I imagine you'd want to work with an M2M connectivity provider that has access to CDMA and GSM. The wireless operators are putting a big focus on the space though. I think both will hold their own for awhile, but I wouldn't be surprised if we see more consolidation. Maybe T-Mobile would want to buy its longterm partner RACO back? It lost valuable time in M2M.
Featured Video
From The Founder
Light Reading is spending much of this year digging into the details of how automation technology will impact the comms market, but let's take a moment to also look at how automation is set to overturn the current world order by the middle of the century.
Flash Poll
Upcoming Live Events
November 30, 2017, The Westin Times Square
December 5-7, 2017, The Intercontinental Prague
March 20-22, 2018, Denver Marriott Tech Center
May 14-17, 2018, Austin Convention Center
All Upcoming Live Events
Infographics
SmartNICs aren't just about achieving scale. They also have a major impact in reducing CAPEX and OPEX requirements.
Hot Topics
Juniper's New Contrail VP Hails From Google
Craig Matsumoto, Editor-in-Chief, Light Reading, 11/15/2017
Eurobites: Telefónica Reckons Plastic Is Fantastic for FTTH
Paul Rainford, Assistant Editor, Europe, 11/15/2017
AT&T's Lurie Leaps to Synchronoss as New CEO
Dan Jones, Mobile Editor, 11/17/2017
Animals with Phones
Live Digital Audio

Understanding the full experience of women in technology requires starting at the collegiate level (or sooner) and studying the technologies women are involved with, company cultures they're part of and personal experiences of individuals.

During this WiC radio show, we will talk with Nicole Engelbert, the director of Research & Analysis for Ovum Technology and a 23-year telecom industry veteran, about her experiences and perspectives on women in tech. Engelbert covers infrastructure, applications and industries for Ovum, but she is also involved in the research firm's higher education team and has helped colleges and universities globally leverage technology as a strategy for improving recruitment, retention and graduation performance.

She will share her unique insight into the collegiate level, where women pursuing engineering and STEM-related degrees is dwindling. Engelbert will also reveal new, original Ovum research on the topics of artificial intelligence, the Internet of Things, security and augmented reality, as well as discuss what each of those technologies might mean for women in our field. As always, we'll also leave plenty of time to answer all your questions live on the air and chat board.

Like Us on Facebook
Twitter Feed
Partner Perspectives - content from our sponsors
The Mobile Broadband Road Ahead
By Kevin Taylor, for Huawei
All Partner Perspectives