According to Ericsson, the acquisition builds upon the company’s intent to expand globally in wireless enterprise, offering existing customers an increased share of a market valued at US$700 billion by 2030.
“The acquisition of Vonage is the next step in delivering on that strategic priority. Vonage gives us a platform to help our customers monetize the investments in the network, benefitting developers and businesses. Imagine putting the power and capabilities of 5G, the biggest global innovation platform, at the fingertips of developers. Then back it with Vonage’s advanced capabilities, in a world of 8 billion connected devices. Today we are making that possible,” comments Ericsson president and CEO Börje Ekholm.
Ekholm stresses how Vonage will be significant to capitalise on new 4G and 5G capabilities.
“Vonage’s strong developer ecosystem will get access to 4G and 5G network APIs, exposed in a simple and globally unified way. This will allow them to develop new innovative global offerings. Communication service providers will be able to better monetise their investments in network infrastructure by creating new API driven revenues. Finally, businesses will benefit from the 5G performance, impacting operational performance, and share in new value coming from applications on top of the network,” Ekholm says.
“Ericsson and Vonage have a shared ambition to accelerate our long-term growth strategy. The convergence of the internet, mobility, the cloud and powerful 5G networks are forming the digital transformation and intelligent communications wave, which is driving a secular change in the way businesses operate,” says Vonage CEO Rory Read.
With Vonage’s acquisition, Ericsson also gets to expand its technology portfolio. It also gets to manage a healthy business that generated US$1.4 billion in the 12-month period ending 30 September. Ericsson will also gain 120,000 Voyage customers and one million registered developers.
Ericsson will acquire all of Vonage’s shares at US$21 per share.
The acquisition is subject to Vonage shareholder approval and regulatory bodies, but Ericsson expects to close it by the first half of 2022.
This first appeared in the subscription newsletter CommsWire on 23 November 2021.