The acquisition race picks up
 
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Media gateways, softswitches, service-delivery platforms, provisioning tools . . . what's a next-generation service provider to do? Choose all these vendors, buy all their products and suffer from box burnout? The stronger next-generation equipment vendors don't think that's the way it should go. So there's a renewed wave of consolidation beginning -- among companies with similar products and those with products in different areas trying to build a one-stop shop.
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The problem is, to acquire somebody you have to offer them something they want. These days that means either cash or a stock with some market momentum attached to it. Suddenly that seems to put Lucent and Nortel on the sidelines, at least until their stocks bounce back. Expect to see stepping into the void the limited number of newer vendors that have achieved actual market presence. We saw a perfect example this week when Sonus Networks, maker of a scalable packet telephony suite that combines gateway, softswitch and other functions, announced plans to buy Telecom Technologies, Inc. (TTI). TTI also makes softswitches -- software-based vehicles that emulate the features of traditional telco switches at a fraction of the price. But TTI is fairly well-known for its interoperability testing and alliance program, which is much more than a buzzword at its lab in the so-called "Telecom Corridor" of Richardson, Texas. Sonus wants service providers to know that its equipment interoperates with a wide range of premises-based integrated-access devices (IAD), media gateways and other gear -- and that's work that TTI has taken quite seriously. Although there is some overlap between the Sonus and TTI products, the latter's gear has been built specifically for termination of dedicated voice access lines directly to enterprises rather than just inter-carrier trunking. That's also capability that Sonus very much wanted to have. It didn't hurt that Sonus was one of the most successful IPOs during the past difficult six to eight months for tech stocks. Sonus' stock shot up to over $200 a share on the strength of numerous customer wins with players such as Global Crossing and Intermedia, and then generated a recent stock split, before coming back down to a mere tripling or so of its original price adjusted for the split. That seemed attractive enough for TTI to accept the offer of 10.8 million new shares of Sonus stock. The IAD market also saw some acquisition action this week as Vina Technologies bought Woodwind Communications Systems. Vina is a company that has successfully sold its Multiservice Exchange IAD line into next-generation carriers seeking to offer managed ATM-based convergence services. But Vina also felt it wanted to offer a pure voice-over-IP IAD option -- one that Woodwind gives it.
RELATED LINKS
Sonus debuts management package for packet telephony
Network World, 09/07/00.
More news and information on Sonus
from Network World.
IAD choices added to MCI WorldCom's 'Smart Bandwidth'
Network World, 05/08/00.
More news and information on Vina
from Network World.
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