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Cisco acquires small cell pioneer Ubiquisys

Networking giant to pay $310m to accelerate its progress into the heart of the mobile network via metrocells


Published: 4 April, 2013

READ MORE: M&A | UK | Cisco Systems | Femtocell

Cisco's latest acquisition goes to the heart of its strategy to play a pivotal role in the small cells revolution. It will pay $310m for the UK's Ubiquisys, one of the pioneers of the tiny, low power base stations.

The US giant has steered clear of the radio network (apart from a brief flirtation with Navini) but has a powerful position in the mobile operators' core networks, and has stated that it aims to be a major force in small cells. Its initial partner was another UK early mover, ip.access, with which Cisco provided AT&T with its femtocells. As the market's attention shifts from private, indoor modules to public access cells and LTE, Cisco has said it will develop its own platform, and Ubiquisys brings it the technology and skills to do this.

The deal is expected to close in the fourth quarter of Cisco's 2013 fiscal year and the Ubiquisys team will join the giant's service provider mobility business, reporting to Partho Mishra. "Small cell technologies are one of the most cost effective ways to add data capacity and will grow in importance as service providers address the explosion of mobile network traffic." Wrote analyst Brian Marshall of ISI Group in a client note quoted by Bloomberg. "The acquisition adds to the mobility capabilities Cisco has been building up."

Ubiquisys was co-founded in 2004 by three executives including current CTO Will Franks and has received funding from Accel Partners, Google, Advent Venture Partners and T-Mobile Venture Fund, among others. The firm initially created indoor 'femtocells' but in recent years has expanded its vision, producing a software platform that enables partners to develop small cells at low cost; moving towards public access and LTE cells; and working with Intel on the 'smart cell', a companion system to carry out processing tasks such as caching at the cell edge.

Ubiquisys has worked with assorted larger partners, including NEC of Japan. The purchase accelerates Cisco's move into the heart of the cellco network via metrocells, and improves its competitive position against small cell enthusiasts such as Alcatel-Lucent, and more cautious movers like Ericsson.

After a period of austerity while it reorganized its business, Cisco is back in full serial acquirer mode. Recently it has purchased self-optimizing networking start-up Intucell for $475m, policy vendor BroadHop, and enterprise cloud specialist Meraki for $1.2bn, among others, although it is also selling some units, notably Linksys.

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