Mavenir buys ip.access to plug its 2G, 3G deficit
Samsung would not do as a replacement for Huawei, said Howard Watson, BT's chief technology officer, when grilled in the summer by UK politicians about alternatives to the controversial Chinese vendor.
His reason? The South Korean firm offered no support for 2G or 3G. And those ageing technologies are still widely used across the UK service provider's network.
It was a warning to other vendors that lack 2G and 3G capabilities, and it largely explains Mavenir's decision to buy ip.access, a company better known as a developer of "small cell" technologies.
Mavenir is one of several US software firms in the vanguard of open RAN, a trendy technology that promises to let operators mix components from different vendors at the same mobile site.
Service providers and politicians are hopeful open RAN will inject competition into a market currently dominated by Huawei, Ericsson and Nokia.
The restrictive interfaces used in their traditional products lock operators into one vendor's system, say critics. Open RAN could change all that.
But only if it can handle older technologies too. While Mavenir could tick the requisite 4G and 5G boxes, it had nothing to offer service providers, like BT, with a continuing need for 2G and 3G software.
As a growing number of operators plan open RAN investments, Mavenir was at risk of missing out.
A multi-G offer
Until now, that is. ip.access, the company whose takeover it announced today, designs radio products that are intended for much smaller cell sites, typically used in hotspots such as airports or shopping malls.
Besides covering 4G and "5G-ready" technologies, those products include 2G and 3G as well and are used by roughly 50 service providers worldwide, ip.access claims.
"Multi-G" was therefore the expression used liberally in Mavenir's statement on the takeover – by executives from both firms.
And while the terms of the deal were not disclosed, it was welcomed as a positive move by Gabriel Brown, a principal analyst with Heavy Reading.
"Looks a good company for Mavenir to acquire for the reasons stated in the release – 2G/3G/4G capabilities and a small cell portfolio – but also because ip.access is a small company steeped in experience of how to integrate small cells in operator networks as an alternative vendor," he told Light Reading.
"That institutional knowledge will be worth a lot to Mavenir as it seeks to establish a broader portfolio and grow its RAN business."
The acquisition of 2G and 3G expertise should help Mavenir to close a gap with Parallel Wireless, an open RAN competitor that has long touted its support for those technologies.
Based in New Hampshire, Parallel Wireless has been able to land various deals in Africa and other emerging markets where people still rely heavily on the older standards.
In the more developed European market, both Mavenir and Parallel Wireless have recently been active in open RAN trials with Vodafone.
Just like BT, Vodafone will eventually need a replacement for Huawei in the UK after the government recently decided to ban it from the 5G market beyond 2027.
Mavenir's ip.access takeover is not just about "multi-G" service provider networks, though. It clearly also has an eye on the products that ip.access designs for the hundreds of customers it claims in the enterprise sector.
Like open RAN, this "private networks" market has been one of the industry talking points in the last year, and it appears to be growing fast.
Nokia's enterprise business recorded 18% growth in sales in the recent second quarter, as overall revenues fell 11%.
The Bundesnetzagentur, Germany's telecom regulator, last week said it had awarded 74 spectrum licenses to corporations that want to build and operate their own private networks and not rely on telco airwaves.
"There has been a great amount of interest in the spectrum, and we are anticipating a large number of applications still to come," said Jochen Homann, the Bundesnetzagentur's president, in a statement.
Another sign of enterprise momentum came earlier this month with Ericsson's $1.1 billion takeover of Cradlepoint, a US company that sells wireless products to first responders and other businesses.
Although quiet on the terms of the deal, Mavenir said ip.access forms its own separate business unit within Mavenir's emerging business group, led by Sweden-based Aniruddho Basu.
Mavenir says that offers scope for "synergies" – a word that usually means either cost savings or cross-selling opportunities – in the areas of open RAN, cloud core, edge and analytics.
Brown thinks one potential challenge will be to amalgamate two fairly different-looking organizations.
"I imagine there might be a little cultural adaptation needed on both sides," he said.
"ip.access is essentially conservative, tries to live within its means and takes a sure but steady approach to new products and markets.
"Mavenir's culture is more fast moving, more risk taking and more gung ho."
- Mavenir opens radio R&D unit in Ericsson's backyard
- The People's Front of Open RAN vs. the Open RAN People's Front
- People are getting the wrong idea about open RAN
- Huawei's 5G license win in Germany may rile opponents
- Ericsson spends $1.1B on Cradlepoint in strategic shift
— Iain Morris, International Editor, Light Reading