Mobile Network Market Overview
H1 2013

0
Contents
I.

Recent M&A Activity

II.

Mobile Network Market Overview

III.

Key Highlights

1
Recent M&A Activity

2
M&A Accelerating in the Sector
Transaction

EV/Revenue

Value ($M)

Multiple (x)

04/08/13

NA

NA

Microsoft Corporation,...
Mobile Network Market Overview

4
Mobile Network Market Map
Packet Core

Media
GW

Diameter
Routing

BSS / OSS

Macrosite
RAN

CSCF

Back office IT

Network...
Companies in the Mobile Network Sector
Packet Core
Network Security

Serving GW/PDN GW/MME

FemtoGW

DPI

Flow Processing
...
Companies in the Mobile Network Sector (cont.)
Packet Core
IMS Functions
PCRF

CSCF

ADCs

Media GW

Subscriber Management...
Companies in the Mobile Network Sector (cont.)
RAN
Backhaul Equipment

Femtocells

Metrocell RAN

Wifi Offload RAN

eNodeB...
Companies in the Mobile Network Sector (cont.)
Back Office IT
BSS/OSS

Mobile Analytics

9
Key Highlights

10
Key Highlights:
Packet Core and Network Functions Virtualization


Mobile Packet Core is dominated by tier 1 suppliers
— ...
Key Highlights: Radio Access Network (RAN)
Small Cells and Wi-Fi Offload


Consumer femtocell market established and matu...
Key Highlights: Back Office IT
Network and Subscriber Analytics: Mobile Analytics


Deriving network data for sophisticat...
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WCP Mobile Network Market Overview

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The Mobile Network is seeing more M&A as the industry sees growth in Packet Core and Network Functions Virtualization, Radio Access Network (RAN), and Back Office IT.

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WCP Mobile Network Market Overview

  1. 1. Mobile Network Market Overview H1 2013 0
  2. 2. Contents I. Recent M&A Activity II. Mobile Network Market Overview III. Key Highlights 1
  3. 3. Recent M&A Activity 2
  4. 4. M&A Accelerating in the Sector Transaction EV/Revenue Value ($M) Multiple (x) 04/08/13 NA NA Microsoft Corporation, Mediaroom IPTV Business comprises Internet protocol television business of Microsoft Corporation which designs software used by phone companies to deliver television over the Internet. 2) 04/03/13 NA NA Tekelec, Inc. develops telecommunications products for fixed, mobile, and packet networks worldwide. It provides policy management, diameter and SIP signaling, subscriber data management, performance intelligence center, and SS7 signaling products. 3) 04/03/13 $310.0 NA Ubiquisys Ltd., a mobile communications company, designs and develops communications devices for mobile operators and consumers. 4) 02/04/13 $2,003.8 5.8x Acme Packet, Inc. provides session delivery network solutions that enable the delivery of voice, video, data, and unified communications services and applications across Internet protocol networks. 5) 01/23/13 $475.0 NA Intucell Ltd. provides self optimizing network solutions to mobile operators worldwide. 6) 01/23/13 $20.0 NA Neuralitic Inc. provides mobile data intelligence solutions. 7) 01/07/13 $27.4 NA Vineyard Networks develops and provides network application intelligence solutions. 8) 05/07/12 $145.0 3.0x Anue Systems, Inc. provides networking solutions to telecommunication and cable service providers, government agencies, and corporations with data centers and enterprise networks. 9) 05/01/12 $30.0 NA Ortiva Wireless, Inc. provides video optimization solutions for mobile network operators (MNOs) and managed service providers (MSPs). 10) 02/21/12 $400.0 NA BelAir Networks Inc. provides mobile wireless broadband mesh networking solutions for video, voice, and data. 11) 02/20/12 $129.7 NA Traffix Systems Ltd. provides next generation networks (NGN) control plane and diameter solutions for telecommunication companies. 12) 06/14/11 $1,150.0 NA Traffix Systems Ltd. provides next generation networks (NGN) control plane and diameter solutions for telecommunication companies. # Date 1) Acquirer Target Target Business Description 3
  5. 5. Mobile Network Market Overview 4
  6. 6. Mobile Network Market Map Packet Core Media GW Diameter Routing BSS / OSS Macrosite RAN CSCF Back office IT Network and Subscriber Analytics RAN IMS Functions Applications Services HLR/HSS Subscriber Management, Athentication, Roaming PCRF Wifi Offload RAN Metrocell RAN ADCs E-RAN Serving GW PDN GW MME Femto GW CDN functions Network Security Flow Processing DPI SON / RAN Optimization Backhaul Femtocells eNodeB 5
  7. 7. Companies in the Mobile Network Sector Packet Core Network Security Serving GW/PDN GW/MME FemtoGW DPI Flow Processing CDN SON/RAN Optimization 6
  8. 8. Companies in the Mobile Network Sector (cont.) Packet Core IMS Functions PCRF CSCF ADCs Media GW Subscriber Management, Authentication, and Roaming HLR/HSS Diameter Routing 7
  9. 9. Companies in the Mobile Network Sector (cont.) RAN Backhaul Equipment Femtocells Metrocell RAN Wifi Offload RAN eNodeB Macrosite RAN Enterprise RAN 8
  10. 10. Companies in the Mobile Network Sector (cont.) Back Office IT BSS/OSS Mobile Analytics 9
  11. 11. Key Highlights 10
  12. 12. Key Highlights: Packet Core and Network Functions Virtualization  Mobile Packet Core is dominated by tier 1 suppliers — Cisco, Ericsson, Huawei, NSN. New entrants include Juniper, Alcatel-Lucent, FIV  New hardware and software solutions increasingly introduced to optimize network performance — Network security, subscriber security, policy management, policy enforcement, deep packet inspection, ADC (app delivery controller), video processing, diameter routing, many IMS functions. — We expect major suppliers to fill in portfolios through acquisitions  Strong trends to virtualize many functions from “big iron” hardware to software on carrier grade servers  Along with incumbents, FIV is in prime position to expand its portfolio with acquisitions 11
  13. 13. Key Highlights: Radio Access Network (RAN) Small Cells and Wi-Fi Offload  Consumer femtocell market established and maturing  Carrier owned and managed Wi-Fi market entering high growth — Lowest cost bandwidth to dense pedestrian users — Maturing systems market with leaders – Cisco, Ericsson, Ruckus, Huawei — Software ecosystem still developing. M&A likely needed to fill out client apps, policy, authentication  Outdoor small cell (licensed) market developing quickly — Major RAN vendors expected to dominate Ericsson, Huawei, NSN, Alcatel-Lucent — Small hardware and software tuck-ins likely required to fill portfolio – custom ASICs, SR wireless backhaul  Indoor small cell (licensed) market still nascent — Opportunity for non-RAN vendors to participate – Cisco, Spidercloud (private), Ruckus, Aruba Networks, and others — Interoperability with RAN and mobile core remains a big challenge 12
  14. 14. Key Highlights: Back Office IT Network and Subscriber Analytics: Mobile Analytics  Deriving network data for sophisticated analysis is new and a very hot market likely to see significant M&A. New area of study for WCP Research  Highly fragmented market with dozens of small and large suppliers but no obvious winners — Likely leaders: Oracle, IBM, Ericsson, Cisco and JDSU — Healthy venture investment in past 2 years — Hot small players with valuable carrier wins 13

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