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Metaswitch Squeezes AppTrigger

Phil Harvey
3/9/2010

What a small world.

VoIP technology specialist Metaswitch Networks is to acquire AppTrigger Inc. , the service broker vendor based in Richardson, Texas. (See AppTrigger Enhances Service Broker.)

The move, among other things, will result in Chris Todd, the CEO of AppTrigger, once again working for Kevin DeNuccio, Metaswitch's CEO. Todd, who joined AppTrigger in 2006, previously worked as a service provider group sales executive, reporting to DeNuccio at Cisco Systems Inc. (Nasdaq: CSCO).

DeNuccio famously spent a few years at the helm of Redback, which was acquired by Ericsson AB (Nasdaq: ERIC). He joined Metaswitch little more than a month ago. (See Redbacker DeNuccio Becomes Metaswitch CEO.)

AppTrigger, founded as Carrius Technologies in 2001, specializes in telecom service brokers -- a media gateway of sorts that allows applications written for one kind of network to be deployed on any other kind of network.

In a sense, a service broker (which we classify as a Service Provider Information Technology (SPIT) element) can act as a softswitch, a media gateway, and a signaling gateway, all rolled into one, giving carriers the ability to port, for instance, wireline apps to a wireless network. (See The SPIT Manifesto.)

And this niche market sector is hot. Only a month ago Oracle Corp. (Nasdaq: ORCL) announced the acquisition of Convergin , while Amdocs Ltd. (NYSE: DOX) snapped up jNetX Inc. in late 2009. (See Oracle Buys Convergin, Amdocs Rallies, Fills SDP Hole , and Amdocs Buys jNetX.)

AppTrigger, Convergin, and jNetX, along with Aepona Ltd. and OpenCloud Ltd. , formed the Service Broker Forum in May 2009. (See Service Broker Forum Formed.)

Light Reading has been slobbering over AppTrigger for the past few years. We called it a young startup, when it clearly had laugh lines and crow's feet. We nominated it for awards and selected it as one of our Top Picks for 2009. (See Light Reading Reveals Its 2009 Top Picks and Leading Lights Finalists .)

The hype was understandable. The company is a classic example of the telecom service broker as a network element. It wasn't a smoky cloud of mystery, but a finite piece of gear that is used within other vendors' telecom network and service environments, and it handles the network aspects (signaling, protocols, call flows, and the like) as well as service-logic aspects. (See Startup Spotlight: AppTrigger.)

A solid summary of AppTrigger's functionality and approach to the service broker space is included in our recent special feature, Who Makes What: Telecom Service Brokers.

That feature also contrasts AppTrigger's approach to at least six other vendor interpretations of the telecom service broker function, so it's definitely worth a look.

DeNuccio, in a call with Light Reading, said the appeal for Metaswitch is pretty straightforward: "We are an applications player -- we have call control, unified messaging, etc. -- but we're also a large switching player. This gives us the glue between the infrastructure and the applications layer."

His point, he says, is that now Metaswitch will be better able to serve carriers at whatever phase they are in the transition from legacy to IP networks.

Like many a company Metaswitch's size, DeNuccio is careful to make his company sound like a specialist that's big enough to help the major carriers, but not one that claims to be an "end-to-end" systems supplier. "We're trying to position ourselves wherever the carrier transition needs are," he says. "We want to be the agile, innovative player in the marketplace."

The financial terms of the acquisition deal haven't been disclosed. DeNuccio says Metaswitch is in the middle of its 2010 fiscal year and is on track to do way more than $100 million in annual revenues. He says AppTrigger could be responsible for 5 to 10 percent of Metaswitch's revenues in the next couple of years.

— Phil Harvey, Editor-in-Chief, Light Reading

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DCITDave
DCITDave
12/5/2012 | 4:41:25 PM
re: Metaswitch Squeezes AppTrigger
Nice pic. The horns need to be placed a little higher, though. You're right, indeed, to be skeptical of an acquisition by a mostly organic company. But I think this space is consolidating so fast that there's a bit of an asset grab going on for all these companies that look like they could add value to an apps/softswitch portfolio.
googol_byte
googol_byte
12/5/2012 | 4:41:25 PM
re: Metaswitch Squeezes AppTrigger


Looks like this is the first M&A deal MetaSwitch/Data Connection has done in its long history.  Does it make sense as deal #1?  Surely there were better companies out there that could complement MetaSwitch's products and customer base - so let's hope that this is not the first step in DeNuccio taking the company down.  Or the other explanation is that it was a fire sale and companies like Genband just had their hands full at the moment.

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