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P-Cube Strikes Double Deal

Light Reading
LR Mobile News Analysis
Light Reading
2/23/2004

CANNES, France -- 3GSM Congress -- Data services platform startup P-Cube Inc. has stolen a march on rival vendors by announcing not one but two high-profile carrier wins (see P-Cube Wins Customers).

The company has inked deals with Hutchison 3G Italy and Israel’s Pelephone Communications Ltd., marking its first success in the wireless space (see P-Cube Wins Customers). Founded in 1999, the vendor is already active in the fixed network and cable markets, counting Interoute Telecommunications and @NetHome as customers.

In an effort to target wireless carriers, P-Cube has developed what it calls a “Service Control Platform” (SCP), which sits off to the side of the GPRS gateway support node (GGSN) or the packet data serving node (PDSN) in wireless networks. The kit aims to enable operators to create, rate, and bill for fancy new data services without needing to upgrade their transport infrastructures.

Meanwhile the Pelephone deal is "currently in a trial phase and they hope to go live in the next couple of months," according to P-Cube marketing VP Milind Gadekar.

Gadekar is unable to disclose the juicy financial details of either win, but is keen to stress that another carrier name is also set for public display next month. “To date we have secured three customer wins and will announce the third at CTIA.”

P-Cube’s success gives the vendor a clear lead over rival startups in this space. ProQuent Systems Corp. has so far only notched up a sole deal with Portugal Telecom Group subsidiary, PT Inovação, while ex-wireless router startup Megisto Systems Inc. will unveil a customer win tomorrow (see ProQuent Wins Portugese Deal and Megisto Breaks Silence).

Analysts believe today's announcements are also a kick in the teeth for incumbent network suppliers. “The impressive part of these deals is that each operator is currently in bed with a big-name vendor in the mobile packet data space: Pelephone with Nortel and 3 Italy with Cisco,” reveals Peter Jarich of Current Analysis.

“Clearly, no vendor can be all things to all carriers, but Nortel and Cisco pride themselves on the flexibility of their PDSN and GGSN platforms. Embarrassingly, 3 Italy is actually Cisco’s only listed success story for its Mobile Exchange platform... If the big guys can’t sufficiently support these packet data needs, it seems like operators who are already tied up with a particular vendor may need to look to vendors like P-Cube.”

P-Cube’s Gadekar claims that today’s announcements will further its aim to hit break-even “by the end of the year.” The startup has raised a total of $70 million in VC funding and "does not envision the need to raise any further funds.”

In addition, Gadekar is optimistic that its Hutchison deal can be repeated with the greenfield carrier’s other 3G ventures. “We are definitely hoping to leverage this in 3’s other networks. Given that we have already deployed in Italy and it has been received very well, we should be able to leverage this in other geographies.”

— Justin Springham, Senior Editor, Europe, Unstrung

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