Consolidation in the B2B CSP market with Ribbon and ECI set to merge

Two companies involved in providing communications services to other companies are merging to make a single bigger one.

Ribbon Communications focuses on cloud communications as a platform while EDI provides network solutions to companies like operators and cloud providers, so there’s a distinctly cloudy theme to this merger. Rather confusingly Ribbon says it’s acquiring ECI through a merger. Ribbon is handing over 32.5 million shares, which equates to around $130 million, as well as $324 in cash to mergaquire ECI.

“The ECI acquisition will extend Ribbon’s reach into the networking market and propel us into the global 5G market,” said Daryl Raiford, CFO of Ribbon. “ECI brings world class networking technology and a proven track record of success in winning top customers in direct competition with major industry players.

“Ribbon has long-standing, deep customer relationships in North America and Japan, which will provide immediate access to ECI solutions into these substantial markets. We believe this combination will create new revenue opportunities to drive growth, provide our customers and partners with a broader solutions portfolio, and generate significant long-term value for our stockholders.”

“We are excited to join forces with Ribbon, bringing together Ribbon’s and ECI’s rich portfolios of communications solutions,” said Darryl Edwards, CEO of ECI. Both companies enjoy a distinguished operating history and are trusted suppliers to the world’s leading telecommunication service providers and enterprises. We aim to create a powerhouse company that offers world-class products for an enhanced customer experience, benefiting our combined global customer base.”

“With ECI’s solid position and long history in the packet-optical transport markets, this acquisition makes sense for Ribbon on multiple fronts, giving Ribbon an entry into the early and growing 5G xHaul transport market while providing its combined customers with a full stack of solutions,” said Don (couldn’t they have found a Darrell?) Frey, Analyst at Ovum. “In addition to cross-selling opportunities, this proposed acquisition will give Ribbon a broad product line and enhance scale as a communications solutions vendor to service providers and enterprises.”

The market doesn’t seem to have such a rosy view of this move, however, with Ribbon’s shares down a whopping 20% at time of writing. Maybe it has something to do with Ribbon CEO Franklin Hobbs bailing on the day of the announcement. Presumably he didn’t think this was such a great idea either, so you can see why investors might be feeling a bit twitchy. They could also have tire of Ribbon’s apparent addiction to M&A in general

Smart Cities are about connected people, not just connected things

Telecoms.com periodically invites third parties to share their views on the industry’s most pressing issues. In this piece Jeff Singman, VP, Product Kandy Business Solutions at Ribbon Communications, looks at the growth of the Smart Cities industry and what should be done to get the best out of it.

The growth of smart cities is unstoppable. So much so that international analyst house IDC, recently predicted spending on the technologies that power smart cities will reach $80 billion in 2018. At Mobile World Congress (MWC) in Barcelona this year, talk of smart cities was in full swing with the show going above and beyond to demonstrate the full capabilities possible with the right infrastructure and technology in place.

Sensors, for example, were everywhere at the show and they are everywhere in our cities, and their benefits are becoming more obvious with every implementation, whether it’s controlling street lighting, orchestrating traffic signals, or making it easier to find an open parking spot.

These sensors and their related IoT systems are reducing energy consumption, measuring the safety and availability of drinking water, even alerting waste management teams to empty trash bins more efficiently.

Cameras are making big cities safer, with algorithms and analytics integrated to alert authorities when a backpack is left on a busy street corner or streaming live video of transportation hubs and capturing criminal activity.

But despite this technological transition, the smart city evolution is still going to be run by human beings. The smartest cities in this sense are those which are connecting public servants with advanced real-time communications platforms that make interactions more productive and efficient.

Consider the power of a law enforcement communications platform that integrates data in smart cities with first responder workflow, as one example. Expensive, complex and limited traditional “command and control” systems are being replaced with cloud communications and Communications as a Service (CaaS) approaches, which go beyond radio communications to full mobile, high definition voice, messaging and video collaboration.

With programmable networks and fully secured end-points and devices, municipal agencies can operate more efficiently and get better outcomes. This is particularly noticeable when those private real-time communications networks and applications improve cooperation between multiple appropriate departments (police, fire, water rescue, ambulance, emergency rooms, schools, etc.) and with county-wide, state-wide and national agencies.

The result? Better prevention, more readiness and preparedness in the face of both natural and unnatural disasters, and generally a faster response when communities face their hardest days.

Beyond those dramatic moments, cloud communications solutions are reducing the cost and complexity of supporting tens and often hundreds of thousands of public workers serving in city hall, the courts, libraries, schools, and more.

For example, Ribbon has been working with one of the largest and most vibrant, advanced cities in the world to transform their legacy communications systems (20-year-old telephony networks) into highly resilient, secure and more flexible platforms supporting employees in the pursuit of getting work done and serving taxpayers more creatively.

For more cities to achieve this level of technological sophistication, however, private organizations must work hand in hand with public sector IT teams on implementation. In the above example, this large city was able to bring in software-defined communications services to agencies across the entire city’s domain. Not only did this deliver mobile experiences for public servants on the go, making “customer service” more intuitive and intelligent, it did so while saving millions of dollars.

In this instance, those cost savings are being reinvested in the expansion of digital communications programs into more departments, while tying more of the behavioral data together, which will contribute towards helping teams become even more productive and effective in the community. This success can be replicated, but it takes time.

At MWC this year, the technology partnership behind the Olympic Games in 2020 announced that they aim to transform the host city, Tokyo, into a 5G smart city. Considering that almost eight million tickets were sold for the Rio Olympics, it’s clear that Tokyo will have to facilitate not only the infrastructure to power this city – another concern noted at MWC – but that these systems will also need to work seamlessly to connect a huge number of people with each other and with their surroundings. That’s a huge challenge and it will be interesting to see what path they select to enable these critical connections.

The growth of smart cities is unstoppable. Soon cities and towns will be able to sense the world around them and communicate more immediately with images, videos, and voice, the ultimate real time tool. But a smart city cannot be limited to connecting things. It must also become smart through connecting people and connecting people with things. All of this must take place in real-time, all the time, and as a foundation for more innovation to come as digital communities and community service become the norm.

 

Jeff SingmanJeff Singman has been the VP, Product Kandy Business Solutions since January 2016. A serial entrepreneur, he previously founded Vizicom to bring end-to-end next generation, real time communications products and services to businesses after having worked for and served many Fortune 500 companies in the areas of media, software, technology, web, mobile and e-commerce. Jeff is expert at connecting people and ideas with the resources, processes and ecosystems that accelerate success as change itself accelerates. His experience includes IT, security, telecom and software, with depth in industries including media, entertainment, financial, and healthcare verticals.