Smith Micro Software has been doing some downsizing over the past several years, but now it's in an acquisition mode with a definitive agreement to acquire Birdstep Technology's software development and marketing arm based in Stockholm, Sweden.
Terms of the all-cash deal aren't being disclosed, but Aliso Viejo, Calif.-based Smith Micro did say it will add substantial technical resources, including engineers trained in wireless connectivity technology. The transaction does not involve the part of Birdstep's business that is based in the U.S.
The acquisition is a good fit because Smith Micro has a strong presence in North America and Birdstep gives it a bigger market presence in Asia Pacific and Europe, according to Carla Fitzgerald, chief marketing officer at Smith Micro. In fact, Birdstep has been its primary competitor in the area of policy-driven solutions for optimizing wireless networks.
Smith Micro is a 30-year-old company that has evolved while serving wireless operators and device makers over the years. Its most recent focus is on efficient network utilization through policy-based software on devices. Birdstep also developed policy-based software on devices and by combining the technologies, it gives Smith Micro a strong position in the market, Fitzgerald told FierceWirelessTech.
In Wi-Fi offloading and onboarding, she said, it's important to measure quality of service associated with Wi-Fi connectivity and have seamless transitions between Wi-Fi and cellular networks. It's also important to use subscriber and end-user insights that can be gained through analytics to not only improve quality but also learn more about how customers use their devices and better market and engage those customers, she said.
For the most part, Smith Micro works with operators that agree to license its software and preload it on their devices for their particular networks, but it also has the ability to provide the software over the top through the app store, which is how Comcast does it with its Wi-Fi app. It is able to offer subscribers an easier way to find and connect to Comcast Xfinity hotspots using Smith Micro's technology embedded in the application.
Smith Micro's software is preloaded on several Sprint (NYSE: S) handsets and several million Sprint handsets in market, and it has recently closed agreements with another cellular operator and cable operator in North America that are under non-disclosure agreements. It also signed on to provide its device management technology embedded on BlackBerry Android devices.
The combination of cellular and Wi-Fi, including in the unlicensed space, represents new opportunities for the company. That's an area where it sees in the second half of 2016 and certainly in 2017 where more operators are going to be looking at applying its solutions and technology, not just in Wi-Fi and LTE but adding the two together, said Brian Deeley, senior director of product management at Smith Micro. That creates a "whole new set of problems with connectivity when you talk about combining networks like that."
The agreement with Birdstep is subject to approval by Birdstep shareholders and is expected to close on or around April 1, 2016.
- see this release
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