Standalone packet core players are hot these days as major vendors look to position themselves in a 4G market that will be defined by the evolved packet core (EPC). As such, network transmission specialist Tellabs snapped up packet core startup WiChorus for $165 million just as WiChorus has made deals with WiMAX players Clearwire and Open Range Communications.
Tellabs said the acquisition will help Tellabs customers more efficiently deliver mobile broadband data. WiChorus made headlines last month when Clearwire selected its SmartCore 4G packet core platform as the gateway to route data traffic, terminate mobile sessions, authenticate devices and track users. At the time, WiChorus said it benefited from the open architecture of mobile WiMAX that allowed Clearwire to select best-of-breed solutions instead of having to go with an end-to-end network product. Open Range Communications selected WiChorus' SmartCore 4G product as well in its quest to serve rural customers in 17 states.
Last week Cisco announced it would buy Starent for $2.9 billion. Cisco said the Starent deal would allow it to better handle mobile data traffic.
Current Analysis analyst Peter Jarich viewed the acquisition favorably since Tellabs already plays on the transport side. The deal means Tellabs can go deeper into the core and execute on potential gateway-transport control synergies.
"Of course, as a start-up, WiChorus will not bolster Tellabs' position over night, particularly since the company must now face the same issue that will weigh on Cisco following its Starent buy: how to position the value of standalone data gateways vs. an ability to build them on routing platforms," Jarich wrote.
- see this press release
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