Virtualization has sparked renewed interest in the OSS and BSS sectors -- here are some of the Service Provider IT (SPIT) companies to watch in the coming year.

December 29, 2014

9 Min Read
10 SPIT Vendors to Watch in 2015

Since we first launched our SPIT (Service Provider IT) Manifesto in February 2010, Light Reading has been banging on endlessly about the increasing importance of "the evolving set of non-traditional telecom (and data networking) technologies that allow for a greater degree of flexibility in the creation, management, delivery and monetization of next-generation communications services." (See The SPIT Manifesto 2.0 and The SPIT Manifesto.)

And guess what? We were right, even if some in the industry didn't think we'd got our terminology quite right. Like it or not, though, there's no denying that SPIT is 'IT.'

SDN and NFV are a direct result of the SPIT trend -- the emergence of more IT-centric capabilities into the wide area networking market. In turn, the growing importance of virtualization has placed even greater importance on the OSS and BSS systems that underpin and help monetize communications networks: MANO (management and orchestration for virtualized network functions) will be one of the hottest acronyms in 2015 and what is that if not next-generation OSS?

In addition, analytics is arguably one of the hottest areas of development for the communications sector right now and that's a SPIT capability through and through. (See Analytics in a World of SDN, NFV & IoT.)

So that prompted us to have a quick think about which SPIT companies either will, or really need to, make the headlines in 2015. So here, in alphabetical order, is our Top 10 SPIT Companies to Watch in 2015.

1. Amdocs
Amdocs Ltd. (NYSE: DOX), with annual revenues of $3.6 billion, has a reach and scale that influences the rest of the SPIT sector, and it has used its scale in recent years to expand its capabilities, become a mover and shaker in NFV circles and develop much-needed analytics capabilities, as CEO Eli Gelman told Light Reading in an exclusive and rare video interview shot recently in New York City. Expect Amdocs to make an even bigger push into virtualization and Big Data analytics next year, both organically and through acquisitions.

2. AsiaInfo
In the past we've noted that AsiaInfo Inc. (Nasdaq: ASIA) could be the Huawei Technologies Co. Ltd. of the SPIT world -- a company built in China that expands and disrupts on an international scale. AsiaInfo started that disruption in late 2013 when it muscled its way into the Danish operations of Telenor Group (Nasdaq: TELN). That was a good start, but what next? If AsiaInfo wants to really mix it with the likes of Amdocs and Oracle Corp. (Nasdaq: ORCL) it needs to make an even bigger and more impressive splash in 2015.

3. Comverse
It's quite simple -- Comverse Inc. (Nasdaq: CNSI) needs a big 2015. CEO Philippe Tartavull has had this company in turnaround mode for about two years, but the company has shrunk significantly during that time. It is still a SPIT heavy hitter, with revenues expected to come in at about $450 to $470 million for the full fiscal year that ends January 31, 2015, but that's a far cry from the near $653 million the vendor achieved in the previous year from the sale of its BSS and service creation platforms. Comverse recently invested in some WebRTC smarts through the acquisition of Solaiemes in August, but it needs to do a lot more in the coming year to get back into growth mode.

4. Ericsson
This list is mostly about the SPIT specialists rather than the giant telecom vendors with broad portfolios, but we need to mention Ericsson AB (Nasdaq: ERIC) because it has spent the past few years buying a bunch of SPIT specialists such as Telcordia and ConceptWave to build up its management system capabilities. Now it has a slightly new focus -- expanding its SPIT capabilities to support a broader range of customers as it expands outside of telecom and into other verticals. That trend started with the acquisition of MetraTech earlier this year, and we expect to see follow-on M&A and partnership action in 2015 to support this strategic move.

Next page: From Matrixx Software to UBIqube Solutions

5. Matrixx Software
Matrixx Software Inc. has a sweet spot that in many ways is right at the heart of SPIT -- it has developed a platform for real-time transactions, and a suite of applications (online charging, policy management, pricing analytics) that is, in the company's own words, "fit-for-purpose for where communications service providers are going, rather than where they have been." The company raised new funding in 2014, with Swisscom and Telstra Ventures among its backers. The value of the round was not disclosed but Light Reading believes it was in excess of $13 million. Expect to see that funding pay off in 2015 with greater interest from telcos and potential buyers.

6. NetCracker
The coming year needs to be as much about how Netcracker Technology Corp. can help its parent company, NEC Corp. (Tokyo: 6701), make real international headway as about how NetCracker can prove itself as a SPIT company that's ready to meet the demands of network operators that are introducing NFV and SDN into their networks. NetCracker has made significant progress with major communications service providers in 2014, and there's every reason to believe it can continue to do so in 2015, and that it will be good enough on its own to keep the company in the spotlight. But there's a real opportunity for NEC, one of the early movers in the SDN market, to bring a combined SDN/NFV/MANO proposition to the global market, using NetCracker for the next generation OSS proposition. The question is: does NEC have the will and the wherewithal to do that?

7. NetScout Systems
NetScout Systems Inc. (Nasdaq: NTCT) has long been a major network monitoring and analytics systems provider but it signaled its intention to become an even bigger SPIT player earlier this year by announcing an all-stock bid valued at $2.6 billion for Danaher's Communications unit, which includes Tektronix Communications (network probes, customer experience management, analytics) and security systems specialist Arbor Networks . That deal should close in 2015, after which NetScout will be able to put the meat on the bones of its new strategy. Also in 2015, the bell should sound on the next round of the legal fight between the vendor and Gartner Inc. .

8. Ontology Systems
With more and more data flowing across communications networks, CSPs need greater (and more insightful) visibility into what's going on with those networks. That need will become even greater, and the task harder, with the introduction of virtualized network elements. That's been the focus of Ontology Systems , which has developed a system designed to deliver an accurate view of network resources to operations teams. Ontology might not be the best known name in the industry but our gut feeling is that it's going to attract more attention in 2015.

9. Oracle
What will Oracle Corp. (Nasdaq: ORCL) do in 2015? It's already hard at work in the OpenDaylight SDN controller group and has been developing its NFV strategy. It also acquired field management OSS specialist TOA Technologies. Yet we expected more from Oracle's Communications division in 2014 after it splashed its cash to acquire signaling and policy control specialist Tekelec and IP infrastructure (session border controller) market leader Acme Packet the year before. It's not that 2014 was the year Oracle crawled into its shell, but… Let's just say we're expecting bigger things in the comms space from Oracle in 2015.

10. UBIqube Solutions
It took a few years for French SPIT vendor UBiqube Plc to find its niche, its role, but then the virtualization wave hit the telecom sector and everything fell into place for a company that has spent most of its time and resources on developing its technology and building customer relationships rather than shouting about them. But with management and orchestration about to be a huge topic in the coming year, and with UBIqube having developed an SDN orchestration system designed to manage hybrid networks that comprise physical and virtual elements, we're expecting to hear a lot more from this company in the coming year -- word in the market is that it has some major telco names to add to its customer list.

So there we go -- that's our 10 to watch. Honorable mentions go to MYCOM OSI , OpenCloud Ltd. , Openet Telecom Ltd. and WeDo Technologies as a few other names worth keeping an eye out for in the next 12 months – if they're not generating SPIT headlines in 2015 then we'll be very surprised. (See Openet, OpenCloud Deepen Their Ties, A Legacy Worth Saving, Mycom Buys OSI and WeDo Seeks APAC Takeover Targets.)

— Ray Le Maistre, Circle me on Google+ Follow me on TwitterVisit my LinkedIn profile, Editor-in-Chief, Light Reading

Read more about:

Subscribe and receive the latest news from the industry.
Join 62,000+ members. Yes it's completely free.

You May Also Like