Cisco buys Intucell for 'dynamic SON'
Networking giant will pay $475m for Israeli start-up focused on self-optimizing mobile networks
Published: 23 January, 2013
READ MORE: M&A | Cisco Systems | Core Network | LTE
As mobile operators fight to hold back the data deluge, they want increasingly sophisticated tools to manage traffic and optimize performance. Cisco aims to play a key role here, as part of its bid to get closer to the cellcos, by adding a "crucial network intelligence layer" to the carrier network. Its latest acquisition is part of that strategy - the giant is buying Israeli start-up Intucell, which recently achieved high profile thanks to a contract with AT&T for its 'dynamic SON' technology.
Cisco will pay about $475m in cash for the SON (self-optimizing network) specialist and will incorporate it into its Service Provider Mobility Group. The deal is expected to close in Cisco's third fiscal quarter subject to the usual closing conditions and regulatory approval.
Intucell has developed 'dynamic SON' software to allow cells to respond more flexibly to shifts in data and signalling traffic, according to time of day and other criteria, with tools designed, in effect, to allow the cell to 'follow' the user. The firm, which two years ago raised $6m from venture capitalists Bessemer Ventures, also has locations in Singapore and the UK and last year added AT&T to its first public customer, Israel's Pelephone.
Such techniques will form part of emerging SON standards within LTE-Advanced, but Intucell has aimed to steal a march by applying them to existing networks, even if the results are less
dramatic than with a small cell, heterogenous network designed with SON in mind. However, the firm still promises tangible customer benefits such as higher average speeds and greater call reliability and says its system can reduce dropped call rates by 10% and boost overall data capacity by 30% to 50%.
The software identifies cells where capacity is, at least temporarily, being underused. It then signals neighboring base stations to seize some of that excess resource, effectively expanding those cells while shrinking the original one. It retunes the network in real time rather than harnessing pre-determined rules.
Kelly Ahuja, general manager of the Cisco Service Provider Mobility Group, said in a statement: "The mobile network of the future must be able to scale intelligently to address growing and often unpredictable traffic patterns, while also enabling carriers to generate incremental revenue streams."
After something of a hiatus in its characteristic serial acquisition spree, during 2011's reorganization, Cisco burst back on the M&A scene in later 2012 with the purchase of TV software maker NDS for $5bn. Late last year, Cisco bought policy management specialist Broadhop, also for its Service Provider Mobility Group, as well as cloud-based enterprise network provider Meraki; Cloupia, which automates converged data center infrastructure; and Cariden, which makes network optimization tools for ISPs. Broadhop was the eleventh purchase in 2012, and earlier this month, Cisco also invested in virtualization firm Parallels.
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