Oracle continues to make its way aggessively into telecom software, this time with the purchase of Tekelec, a provider of diameter signaling and policy control solutions. Tekelec has been privately held for just over a year; it was taken private in January 2012 by Siris Capital in a deal that valued the company at $780 million.
Analysts at Exact Ventures expect the market for diameter signaling controllers to grow about 50% a year through 2017, propelled by the accelerating pace of LTE rollouts. The firm says that Tekelec currently has a 75% – 85% market share.
The purchase of Tekelec is meant to complement Oracle’s other recent mega-purchase in the telecom software space: the $2.1 billion acquisition of Acme Packet announced last month. Oracle said that by combining the capabilities of Tekelec and Acme Packet with its own software expertise, it expects to provide the “most complete communications offering that will enable service providers to engage with customers, improve operations, control network resources and deploy innovative communications services.”
Oracle’s purchases of Tekelec and Acme Packet highlight three key industry trends, according to analyst Dana Cooperson of Ovum:
1. the continued blending of telecom and IT
2. software as the key driver of network capabilities
3. anytime/anywhere communications
“Expect Oracle’s telecom-focused competitors (Alcatel-Lucent, Huawei, Ericsson, etc.) and it’s IT-focused competitors (HP, SAP, SAS Institute) to do more strategic soul-searching and, as their financial situation allows, to pursue acquisitions of their own,” said Cooperson. “Key areas for strategic shoring-up include customer experience management, applications enablement, big data analytics, subscriber data management, and network and service control intelligence.”
Tekelec sees its software as a path for carriers to begin monetizing their relationships with “over-the-top” service providers like Google. At Mobile World Congress, Tekelec’s Jason Emery told RCR Wireless News that carriers are creating “mobile social repositories” for data collected from social network traffic.
“We think that the network is going to go through phases over the next several years,” said Emery, “starting with what we call the new diameter network, growing into something we call cloud-XG, which is really allowing the operators to take advantage of the virtualization technology that needs to be deployed in the network to make their networks scale and be able to handle the growth in different ways across their network and then moving into something we call mobile social, which is allowing the operators to take advantage of the social networking explosion that’s going across the world and monetize the social networking that’s going on in the networks, and then eventually getting to thinking networks where the networks can manage themselves, they can elastically grow and shrink and contract and take care of different pockets of explosive growth.”
