Acquisition activity dominated the OSS landscape again in 2007, and there's every chance market consolidation will create the biggest telecom software news stories again in 2008.
But scrape beneath the surface of the year's top takeover news, mix it in with an undercurrent of ad hoc news announcements, and a few interesting trends emerge.
Those trends include: The convergence of so-called "traditional" OSS systems with new-fangled service creation platforms to meet the needs of carriers' next-generation network strategies; the increasingly intense battle between best-of-breed and all-in-one OSS offerings; and the growing strength of the Indian telecom software power base. (See EuroBites: OSS Matters and Turning Point for OSS.)
We've also noticed how network planning has become the new battleground of the OSS vendor community -- expect that particular niche, which emerged from the software closet in the past year, to be hot in 2008. (See Aria Tunes Into PBT , ProVision Offers 4G Planning Tool, Amdocs, GE Team Up, Gridpoint Plans PBT, BT Uses VPIsystems's OSS, and Telenor Uses More Comptel.)
So, without further ado, here's our look at the past year's Big OSS news stories.
10. Amdocs adds to its arsenal
Amdocs Ltd. is one of the small group of OSS heavyweights that have the financial, portfolio, and services muscle to break into almost any carrier back office.
Befitting a company that turns over $700 million-plus in revenues per quarter, it added to its arsenal of capabilities in 2007 by acquiring billing and service delivery specialist SigValue, which specializes in integrated telecom software primarily targeted at mobile operators in emerging markets. (See Amdocs Continues Spending Spree and Amdocs Reports Q4.)
9. Oracle becomes a trendsetter
Oracle Corp., which has had another busy year in the telecom sector, is one of the heavy hitters that, along with the likes of Amdocs and IBM Corp., is pushing for carriers to adopt integrated back office capabilities largely sourced from one supplier.
In November it announced its Unified Inventory Management, which can hook up with Oracle's ERP (enterprise resource planning) and CRM (customer relationship management) systems -- that's quite an accomplishment, and a potential attraction for operators. (See Oracle Leads OSS News Charge.)
The vendor also continued its OSS acquisition spree by announcing in September it was buying Netsure Telecom, a specialist in (drum roll, please...) network planning and optimization. Trendy, or what? (See Oracle Buys Another OSS Firm.)
Oracle also made an aborted takeover bid for OSS and SDP player BEA Systems Inc.. That topic will surely rise again in 2008. (See Oracle Lets BEA Go.)
8. India adds to OSS power base
India is one of the main go-to countries for OSS and applications development these days, boasting as it does a host of large, skilled firms with telecom know-how. (See Who Does What: Outsourcing to India, Aricent Crashes Telecom Software Party, BT Picks Tech Mahindra, and Wipro Buys Infocrossing.)
Among those firms is Megasoft Ltd., which announced in July it was buying billing services firm Boston Communications Group Inc.. (See Megasoft Bids for Boston Comms.)
An interesting move in itself, but what really caught our eye was Megasoft's sense of humor -- it set up a subsidiary called Tea Party Acquisition to make the purchase, which closed in August. (See MegaSoft Completes Boston Buy.)
Tea Party? Boston Comms? GEDDIT!!!????
7. Funding rarity
July 2007 witnessed an event as rare as positive news coverage of Britney Spears -- VC funding for an OSS firm.
The firm was data migration specialist Celona Technologies Ltd., which raised $14 million. They're still partying, apparently. (See OSS Firm Raises $14M.)
It's worth noting that Celona wasn't the only OSS firm to raise some cash in 2007 -- Intelliden Corp. pocketed $10 million in May. (See Intelliden Gets $10M.)
6. AT&T pulls its CARTS into view
Carriers don't come much bigger than AT&T Inc., so its NGN strategy is something close to the hearts and minds of pretty much every telecom vendor.
In June Siroos Afshar, a chief architect at AT&T Labs, told Light Reading about CARTS (Common Architecture for Real-Time Services), part of the operator's vision of how it will function in the future. (See AT&T Defines Service Creation Platform.)
AT&T's vision is important because it shows how major carriers envisage the interworking between OSS and service delivery platforms (SDPs), and, in AT&T's case, shows how views are evolving about how IMS (IP Multimedia Subsystem) could play a role in NGNs.
Find out more about AT&T's progress with its CARTS, and its service creation plans, in our updated report on IMS. (See What's Up With IMS?)
5. Spirent sticks with OSS
Here's a news event that many people weren't expecting -- Spirent Communications plc decided NOT to exit the OSS sector. (See Spirent Cuts Deeper, Sticks With OSS.)
For now, anyway.
The reason? Hanging onto its service assurance business unit is "not hurrying us," noted executive chairman Ed Bramson in early November.
Further signs that the test equipment vendor is turning itself around financially came recently when Spirent announced that its performance in the second half of the year was better than expected. (See Spirent Gets a Lift.)
4. Subex swallows Syndesis
It was only a matter of time before Syndesis got acquired, but no one predicted it would be Indian revenue assurance firm Subex Ltd. that would buy the IP provisioning system specialist for $165 million. (See Syndesis Strikes $165M Takeover.)
The team at Subex, or Subex Azure as it was then, reckoned it needed to make the move out of its comfort zone and into the wider telecom software world if it was to run with the sector's big boys. (See Subex Targets OSS Giants.)
3. Ericsson eyes converged billing
If it moves, Ericsson AB will buy it.
OK, that's maybe a bit much of a generalization, but, given the Swedish firm's track acquisition record from the past year or so, which won it the M&A gong at this year's Leading Lights awards, you can see what we mean. (See LR Names 2007 Leading Lights Winners, Ericsson Invests in IPTV Smarts, Ericsson Lands Tandberg TV, Ericsson Buys Entrisphere, and Ericsson Buys Openwave Rival.)
One of the firms purchased by Ericsson was billing specialist LHS Group. (See Ericsson Buys Billing Vendor LHS.)
Why? Because the giant Swedish meatball was already a major player in the pre-paid billing systems market, but wanted to create a converged (pre-paid and post-paid) billing platform, which is what every major carrier worth its salt will likely want in the future.
Ericsson followed up that June news with another software purchase, this time of service delivery platform specialist Drutt. (See Ericsson Snaps Up SDP Firm.)
2. Telcordia still out there
The ongoing saga surrounding the future ownership of Telcordia Technologies Inc. continued this year, with sources suggesting there was a shortlist of potential buyers that would need the consent of a major systems integration player if they were to get the acquisition green light. (See Telcordia's Takeover Shortlist .)
Maybe 2008 will see all the right conditions for a Telcordia takeover finally met. And if the trigger is pulled maybe it'll herald the entrance of yet another IT giant into the OSS space...
1. SAP targets telecom
SAP AG set its stall out in May, telling Light Reading that it intends to be a player in the OSS sector. (See SAP's Rising in OSS.)
If SAP decides to enter the market, and add to the $500 million in revenues it already generates from carriers' use of its business software platforms, we're hoping it'll be with a big bang acquisition -- Telcordia? Or BEA maybe? -- that will revamp the sector's makeup.
So come on SAP, get a move on!
â€” The Staff, Light Reading