Bright House to acquire cloud communications provider Telovations

Bright House Networks, the sixth largest owner and operator of cable systems in the U.S., announced that it has signed an agreement to acquire Telovations, a Florida-based cloud communications provider that delivers businesses hosted voice solutions, including PBX and managed SIP trunking. The transaction is expected to close within 45-60 days, pending regulatory approvals.

The acquisition is designed to help Bright House Networks provide the enterprise market with cloud based and managed services, as well as continue to offer small and midsize businesses additional services. Telovations' "Communications-as-a-Service" (CaaS) includes communications devices and applications on a pay-as-you-go, as-needed basis, eliminating the need for capital investment.

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In a statement, Leo Cloutier, senior vice president, Corporate Strategy and Business Development at Bright House Networks, said, "We welcome this collaborative opportunity to combine our fiber optic network and managed services offerings with Telovations' cloud-based unified communications services to provide companies with a much broader array of network capabilities and industry-leading services."

Mark Swanson, co-founder and CEO of Telovations, added, "We are thrilled to be joining Bright House Networks as we share a common passion for serving customers. The combination of Telovations' innovative Cloud-based Unified Communications offerings and Bright House's fiber network and broader portfolio of managed services will provide customers some of the most advanced business communications capabilities in the nation."

Bright House Networks operates systems located in five states including Florida, Alabama, Indiana, Michigan and California. The company serves approximately 2.5 million customers who subscribe to one or more of its video, high-speed data and voice services. The company also offers phone, Internet, Ethernet and cable television services to businesses of all sizes.

Our observations: Cable operators continue to build their portfolio for business services with most of the top tier operators now realizing substantial revenues. For example, Comcast reported $621 million in Q3 2012 revenues attributed to business services, while Time Warner Cable had $493 million for the same period. We expect to see cable companies continue with similar targeted acquisitions in the coming year, especially when the acquisitions can improve their portfolios.

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