Ericsson has completed its acquisition of Vonage Holdings Corp. (Vonage), supporting Ericsson’s strategy to leverage technology leadership to grow its mobile network business and expand into the enterprise.
The acquisition provides Ericsson with access to powerful building blocks to offer a full suite of communications solutions including, Communications Platform as a Service (CPaaS), UCaaS, and CCaaS.
- As of July 21, 2022, Vonage becomes a wholly owned subsidiary of Ericsson
- With Vonage on board, Ericsson will create a market for easy-to-adopt global network Application Program Interfaces (“APIs”); this will drive the next wave of digitalization
- Ericsson will generate near-term synergies from bringing Vonage Unified Communications as a Service (UCaaS) and Contact Center as a Service (CCaaS) solutions to its existing customers
- Rory Read, Vonage CEO, appointed member of Ericsson’s Executive Team
By leveraging the Vonage CPaaS offering, Ericsson aims to transform the way advanced 5G network capabilities are exposed, consumed, and paid for. This will provide the global developer community, including Vonage’s more than one million registered developers, with easy access to 4G and 5G network capabilities via open Application Program Interfaces (APIs).
For communications service providers (CSPs), global network APIs – such as location and quality of service APIs – provide new opportunities to expand their profit pools to monetize 5G network capabilities.
For Ericsson, global APIs provide a new material growth opportunity. The existing market for communications APIs – such as video, voice, and SMS – is currently growing at 30 percent annually and is projected to reach USD 22 billion by 2025.
Accessing network capabilities in open, intuitive, and programmable ways via global APIs will enable developer communities to create applications for any device that benefits from connection to the 5G network.
Developers can utilize network characteristics such as user authentication, bandwidth, responsiveness, energy efficiency, security, identification, and reliability – or network information such as device information or predictive coverage.
These new and innovative consumer and enterprise applications will further drive the rollout of 5G and network Capex. To accelerate growth in Vonage’s UCaaS and CCaaS solutions, Ericsson intends to increase R&D investments and offer these solutions to CSPs, enabling Ericsson’s existing customers to sell through their brands, and accelerate growth.
Ericsson will also complement existing communications offerings to small and medium-sized companies with the Vonage UCaaS and CCaaS solutions which will form a strong part of Ericsson’s offerings to both CSPs and enterprises.
Börje Ekholm, President, and CEO said, “We are excited to welcome Vonage as part of Ericsson. With Vonage’s suite of communications solutions – UCaaS, CCaaS, and Communications APIs – Ericsson will further expand its offerings into the enterprise space. In the future, network capabilities will be consumed and paid for through open network APIs, creating the opportunity for unparalleled innovation.”
“We have already launched the first network API, Dynamic End-user Boost, based on the existing 4G infrastructure. With Vonage, we will now develop and commercialize these new APIs. We are already seeing great progress with frontrunner CSPs, and we aim to launch the first 5G network APIs in the coming year”, Börje Ekholm added.
Vonage was recently named the leader in the Omdia Universe: Selecting a CPaaS Platform 2022 report, ranked in top positions on customer experience and solutions capability.
It currently serves over 120,000 business customers and has a global community of more than one million registered developers and a highly scaled platform with a combined 25 billion messages and minutes per year.
This, combined with Ericsson’s deep network expertise, industry-leading portfolio, and global scale, is expected to enable Ericsson to seed and accelerate the market for global network APIs. CSPs will benefit from global reach, beyond national or regional setups.
The acquisition will also further strengthen Ericsson’s presence and long-term commitment to the United States, where it has a 120-year history of conducting business.
Rory Read, Vonage CEO, said, “Vonage was born out of innovation and is today a global leader in business cloud communications. This partnership will strengthen our offerings to businesses across the globe by leveraging Ericsson’s leadership in 5G, global market presence, and strong R&D capabilities.”
“With the demand for UCaaS, CCaaS, and Communications APIs growing rapidly, the combined expertise, talent, and innovation is good news for our customers and partners”, Rory Read added.