Comverse Acquires Acision, Framing Digital an APIs Around WebRTC

16/06/2015

Is Comverse becoming a serious WebRTC player?

Comverse acquires Acision

Comverse is a company in transition. It has been catering the world’s telcos for many years. In recent years, it had its share of issues. Why are they important in the context of this blog?

  1. They acquired Solaiemes. But that was in August 2014. Almost a year ago
  2. Less than 2 months ago, Comverse sold its BSS business to Amdocs
  3. Yesterday, it acquired Acision, for around $210M

What does this say about Comverse?

Comverse is a company searching for their way. Their current focus is digital services with the set of customers being Telcos.

Digital focus means APIs and platforms that enable rapid creation of services.

The interesting part here is that Comverse is getting a sales team and an operation that knows how to sell to enterprises and not only to Telcos. I do hope they will be smart enough to keep that part of the business alive and leverage it.

Open questions include: Will Comverse merge Acision assets with Solaiemes? Try to build one on top of the other?

What does this say about Acision?

Acision got acquired for their SMS and voice business more than for their WebRTC or API platform components. No one gets acquired for that much money for WebRTC. Yet.

It is funny to note that Acision Forge platform, which runs their WebRTC PaaS part, was an acquisition of Crocodile RCS.

Comverse being focused on Telcos, how will they view the Forge platform?

  • As something to be sold to carriers or through carriers? This means taking the route that Tropo took in recent years
  • Would they try to leverage it and expand their offering to enterprises in other areas?
  • Will Comverse management understand the enterprise business enough to try and let it grow unhindered?

Why is this important?

This isn’t the first or last WebRTC related acquisition of the year. We had a few already.

If you are looking to use any vendor for your WebRTC technology, you need to consider the possibility of acquisition seriously.

It also led me to updating my WebRTC dataset subscription service: as of today, its subscribers also receive an updated acquisitions table, detailing all acquisitions related to WebRTC since 2012.

 

Planning on selecting a CPaaS vendor? Check out this shortlist of CPaaS vendor selection metrics:

Responses

JF Sullivan says:
June 16, 2015

Just as a point of clarification. What’s been made clear to the folks at Acision is that the acquisition of Acision was because of a number of reasons, not just because of the legacy SMSC business and certainly not because of the voice business which is considerably smaller that Comverse’s current installed base.

The acquisition is framed around a number of emerging portfolio offerings which Acision has been investing in over the last two years. Notably:

1. Mobile monetization services. Note that these are distinct from the current market of Airtime credit services. This is a rapidly growing segment of the market; despite the overall decline in traditional SMS messaging. These services are characterized by the ability to allow Operators to tap into currently unrealized revenue trapped in the existing messaging traffic.

2. Enterprise A2P traffic, both IP and SMS/MMS. In this arena, Comverse was bereft of solutions that would be leveraged for use by Enterprises who seek secure, direct communications to their customers and trading partners. Acision’s decision late last year to acquire Mindmatics (a secure A2P messaging solution headquartered in Germany) provided a foundation service that could be leveraged to extend the benefits of providing compelling Enterprise solutions, which leads us to…

3. WebRTC. While it is true that Comverse acquired Solaiemes approximately a year ago, much of the Solaiemes technology is designed around the RCS market play. Acision has taken a more risky, considering it’s operator focused business, approach and investing heavily in providing the easiest to use, feature parity services for developers to build WebRTC based applications…for Enterprises and Operators.

Of course, at the time of this posting, this last segment of the Acision portfolio is admittedly nascent when compared to the legacy infrastructure of the overall company. Yet, it is undeniably a fast growing segment of the business. It accounts for more than 30% of the marketing investment and the traffic to the Forge website (the brand currently carrying the WebRTC investment) already far exceeds the traffic to Acision’s own home page.

Time will only tell naturally. Should the merger complete, the ultimate litmus test will be the emerged new company’s messaging and its associated solution portfolio. However, the fact remains that all communications about this pending merger indicate that the acquisition provides an opportunity for cross-selling the installed bases with new technologies in legacy infrastructure and investment into the emerging market opportunities for mobile monetization services and the Forge SDK/A2P businesses. Consider slide #11 from Comverse’s call with investors yesterday:

http://files.shareholder.com/downloads/AMDA-1A9OQV/4116490506x0x835257/185D611F-5F08-4D74-A21AABA5895D42CB/Comverse_AnalystCall_6_14_2015.pdf

Obviously, we remain as interested in these developments as the original poster!

Reply
    Tsahi Levent-Levi says:
    June 16, 2015

    JF Sullivan, thanks for clarifying these points – they are all in place.

    These all being digital services for telcos, the acquisition makes sense on Comverse’ behalf. If it can leverage it and find synergies with its current business and customer base, then you have much to win here.

    Reply

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