Bridgewater is Now "A Division of Amdocs", but Revenues Decline

  
Amdocs completed the acquisition of Bridgewater Systems (see "Amdocs Completes Acquisition of Bridgewater Systems, Enabling Service Providers to Redefine the Data Experience" - here).

BWS web site already reflects that - Bridgewater is now "A Division of Amdocs" (here).

Earlier this week BWS published its Q2 results, showing a significant decline in revenues (see "Bridgewater Systems Reports Q2 2011 Financial Results" - here).

"Total revenue for Q2 2011 was $14.6 million, compared with $22.7 million for Q2 2010. Product revenue for Q2 2011 was $9.3 million, or 63% of total revenue, compared to $17.1 million, or 75% of total revenue, for Q2 2010. The year-over-year decrease mainly reflects two expected and previously disclosed changes: the transition in the Company's business model with its largest customer [see - "Bridgewater Growth - It is all about Verizon"- here] and the expiration of the Alcatel-Lucent Source Code License Agreement in Q4 2010 [see "Bridgewater - Will the Juniper Agreement Replace Alcatel-Lucent Revenues?" - here].

On March, the company provided full-year guidance for 2011 (here), expecting revenues of $88.0 to $100.0M. On May, it was reduced to $77.0 to $87.0M (here). The actual revenues for the first half are $33.7M.

With these results, the price Amdocs is paying for BWS is still (although less then it was during the announcement) attractive compared to the 2010 Tekelec-Camiant deal (see "Camiant Information Exposed (and Compared to Bridgewater" - here).

Amdocs is paying $139M (net of Bridgewater's cash as of June 30, 2011). With estimated ~$70M revenues for 2011, this is a price/sales ratio of ~2, compared to 4.6-5 that Camiant got on its 2010 revenues.

Tekelec: 2010 Orders for Policy and SDM were approx. $40M

 

Tekelec announced its 2010 results, highlighting that "Orders for policy and subscriber data management solutions were approximately $40 million for 2010, doubling our initial expectations at the time of the acquisitions of Camiant and Blueslice".

See "Tekelec Announces 2010 Operating Results" - here. The chart below adds some color to the revenues generated from "Next Generation for Session, Policy and Data Management" ($47M during 2010) - but does include non Camiant/Blueslice products.
 

 

DPI Deployment (41): Vodafone Uses DPI and Policy Management to Improve QoE (and the vendors are..)

   

Lightreading reports from the Boradband Traffic Management Event that "Vodafone Group is beefing up its traffic management capabilities in an effort to improve its customers' service experience, make its network more efficient, and stem the impact of the data deluge that's hitting its network.. Faced with mobile data traffic growth of 100% per year in Europe, it's no longer adequate for Vodafone to provide a best effort service"

See "Vodafone Flexes Traffic Management Muscle" - here.

Andy MacLeod, Vodafone's group network director, said that "As for what that traffic comprises 70% is Web browsing and video, which are about evenly split, and the remainder of the traffic is mostly peer-to-peer (P2P) .. A very small number of users generate most of the traffic. Mobile data isn't terribly mobile and the usage is mainly from home"

"To address the mobile data volumes, traffic patterns, and user behavior, MacLeod highlighted some of the capabilities that Vodafone is working with, including traffic inspection, application optimization, content caching, and traffic offload (in the access network as well as in the transport network).. the personalization that traffic management enables is what improves the customer experience and can lift customer satisfaction .. The biggest upside [of traffic management] is having the ability to help us personalize the experience for customers and optimize yield and profitability"

The DPI and policy management solutions used by Vodafone are provided by Allot (the company did not disclosed this, but Daniel Meron from RBC (pictured), the analyst covering Allot, was quoted here  in Hebrew estimating that "Allot's large mobile operator contract is with Vodafone" ) and Tekelec (Camiant PCRF - here).

Tekelec Policy Product - Q3 Business Highlights

    

During the Tekelec Q3 results (press release - here) conference call, CEO Frank Plastina provided some details on the policy (Camiant) product line wins and business:

• Orders for Camiant and Blueslice products already (after 5 months) exceeded the initial 2010 expectations of $20M
    
• Order received from a Chinese cable operator for policy management to ensure QoS for VoD
    
• New Tier1 account in the quarter include Telefonica (see "PCRF Deployments (35): Telefónica Group Selects Acision/Tekelec" - here)
    
• To date they have 44 policy customers, including Verizon and Vodafone. Tekelec believes that only 5% of all subscribers are covered by policy management deployments.

See also "Infonetics Research: Policy Management is not only Bandwidth Control; Names Top3 Vendors" here and "Yankee Group - Who are the Policy Management Leaders?" - here.

Other policy vendors Q3 results: Bridgewater (here), Comptel (here)  and Openet "Openet Expects Revenues of €75M in 2010" - here

 

PCRF Deployments (35): Telefónica Group Selects Acision/Tekelec

   

Acision announced that "it will be working with Telefónica Group, one of the largest telecommunications companies in the world, to install key elements of Acision Broadband Mobility Suite [chart below] for policy management. As part of the deal, which will be rolled out in Europe and Latin America, Acision will provide a sophisticated policy engine including Tekelec’s Policy and Charging Rule Function (PCRF) platform"

See "Telefonica Selects Acision Broadband Mobility Suite for Intelligent Policy Control" - here.

Note that no specific deployments have been mentioned so it is very possible that Acision/Tekelec/Camiant are not the only platforms to be used by Telefonica subsidaries (see "Telefonica Spain Upgrades to Openwave Integra" - here).

Rory Buckley, Chief Executive at Acision, said: “By deploying Acision Broadband Mobility Suite, Telefónica will have full policy capabilities to help it manage and control all aspects of its mobile broadband traffic, while delivering an improved quality of experience and offering differentiated services and pricing plans that meet individual customer’s needs and drive up mobile data profitability.”

Infonetics Research: Policy Management is not only Bandwidth Control; Names Top3 Vendors

  

A month ago Infonetics Research published a report on the policy management market (here), concluding that "Managing bandwidth consumption remains one of the greatest drivers for policy server".

Based on a new survey, Shira Levine, directing analyst for next gen OSS and policy at Infonetics Research, reconfirms the previous report but provides also a wider angle view: "We have long said that policy is moving beyond basic bandwidth management to enable differentiated services and value-added subscriber capabilities, and this survey confirms that belief. While traffic management remains a key driver behind policy management deployments, operators tell us that they are increasingly implementing policy solutions to better monetize their networks, including tiered services and subscriber control capabilities, such as parental control”.

See "Operators turning to policy management for much more than bandwidth control" - here.

Infonetics found that "Tekelec (who recently acquired Camiant), Openet, and Bridgewater Systems came out on top when operators were asked to list who they consider to be the “top three policy management vendors”.

Compare to - "Yankee Group - Who are the Policy Management Leaders?" - here - Yankee names all 3, together with few others.

Openet was quick to use the marketing opportunity - a day before Infonetics - and issued a press release: "Infonetics Survey on Policy Management Names Openet Among Top Players"- here. 

"Although Openet has been in the policy market a relatively short time compared to our competitors, we are not surprised by Openet's ranking in this survey," said Michael Manzo, CMO of Openet. "Our relationship with Cisco [here and here], tireless innovation and unique approach to combining policy with charging have led to win after win for policy management deployments. This survey confirms what we already know -- that Openet has quickly moved into a leadership position, and with some additional time, will dominate this market."

PCRF Wins: Camiant Selected by 2 Multi-National 3G Service Providers

 

Tekelec announced today that it "has won two multi-national, Tier One 3G mobile service provider deals for its industry-leading Camiant Policy Management solution in Europe and the Caribbean and Latin America (CALA) region. The deals extend Tekelec’s Policy and Charging Rules Function (PCRF) to eight new countries in Central and South America: Argentina, Bolivia, Chile, Colombia, El Salvador, Guatemala, Honduras and Paraguay .. Both service providers are headquartered in Europe".

See "Tekelec's Camiant Policy Management Solution to Be Deployed in Eight Countries in Central and South America" - here.

“By using policy to help control traffic from the earliest stages of their 3G deployments, CALA operators are proactively addressing subscribers’ needs for network flexibility, tiered pricing plans and fair usage policies,” said Susie Kim Riley, Tekelec’s chief marketing officer.

See also - "Latin America becomes world's second-largest mobile market" - here - "According to new figures published on Friday by Wireless Intelligence, mobile connections across Latin America reached a total of 530 million in Q2, while in Western Europe the number of connections declined sequentially to 515 million from 520 million."

Tekelec CTO: "Mobile Operators is a Better Business than OTT Services" - Is it?

    
Vince Lesch, Tekelec's CTO (which carries the former Camiant Policy Management offering) explains in a short video (see below) why mobile carriers are and will be doing better than Over-the-Top content providers.

His main arguments are:

• OTT players are totally dependent on mobile operators
   
• The customers are willing to pay for the mobility value much more than they pay for content. Mobile operators are generating $40-50 a month from each customer while an OTT provider generates a quarter of a penny (if I heard right)

I believe that Vince should have also considered the following:

• An OTT provider targets the national or global population, and is not limited to a single carrier's customer base
   
• A mobile operator has to maintain a very expensive infrastructure (see - "AT&T will invest $19B this Year to Upgrade the Network" - here) to provide the mobility - significantly less than the cost of providing content to a much bigger audience.
  
  As a result, mobile operators are facing the challenge of increased costs vs. decreasing revenues ("scissor effect") - only Value Added Services may improve this.
  
  Can the operators provide enough valuable content without cooperating with OTT players?

And as far as Tekelec is concerned - wont they see more business if they encourage the OTT-Mobile operators cooperation? (see "Net Neutrality - AT&T Endorses Amazon's Win-Win-Win Proposal" - here)

Intriguing [DPI] Triangle - Tekelec, Genband, Procera

  

A small detail in Procera's reporting to the SEC (here) in connection with the appointment of Genband's President and CEO, Charles D. Vogt to its board of directors caught my attention this morning. The address for Mr. Vogt shows as Tekelec's address in Calabasas, CA. This probably has historical roots - since his days in public Tekelec (up to 2004) - after which he left to privately held Genband.

However, this made me thinking about the recent M&A activities in the Traffic management space- DPI and policy management, associated with these 3 companies:

• Vogt was President and CEO of Taqua, which was acquired by Tekelec in March 2004.  Before joining Taqua, Vogt held executive leadership positions at Santera Systems which was acquired by Tekelec in 2005
   
• 3 years ago, Genband acquired from Tekelec both companies (Santera Systems and Taqua - see "Tekelec and GENBAND Sign Agreement for Sale of Tekelec's Switching Solutions Group" - here).
  
  "Charles D. Vogt, President and CEO of GENBAND said “The combination of the two companies creates an enviable gateway and applications product portfolio and enables GENBAND to strengthen our relationship with our existing customers and business partners.”
   
• Earlier this year, Tekelec acquired Camiant, a leading Policy Management vendor, commonly deployed with DPI devices (see "Tekelec CTO on DPI Plans" - here)
   
• Last week, Genband signed an OEM agreement with Procera (see "DPI Market: GENBAND OEMs Procera" - here)

So - is all this part of a grand plan from Genband to build with ultimate IP gateway possibly with some involvement of Tekelec?

Tekelec CMO: "If the consumers want to continue to have access to VoIP or video services, then they have to allow some degree of ‘discrimination’ "

    

Susie Kim Riley, founder and CTO of Camiant and since the acquisition by Tekelec serves as its CMO, was interviewed by Susana Schwartz from Connected  Planet about next generation Services, policy management and the debate with the FCC on Net Neutrality.

  

See the article [with the provocative title] "Telcos, Google & academia — the plot thickens!" - here.

Some [again, provocative - but very true!] quotes:

• "some “ivory tower” academics are applying theory rather than real-world economic and free-market knowledge to push regulators to heavily regulate the industry because they are convinced that operators would definitively block any type of “competing” traffic or applications, even if it meant losing subscribers and losing revenues."
   
• "If the consumers want to continue to have access to VoIP or video services, then they have to allow some degree of ‘discrimination’ so that packets tied to dynamic services get to a destination before non-crucial packets like those associated with e-mail"
   
• ".. She and others are proposing is a “two-sided business model," perhaps most aggressively championed by STL Partners’ Telco 2.0 initiative [here]  – in which service providers would be given the ability to work with third parties in non-discriminatory two-sided business approaches [chart below]. Discrimination has to be viewed in a more balanced way so that operators are allowed to do what is “reasonable” in managing network resources and allow room to make some revenue off of the broadband services the service providers are enabling"
   

• “You can subsidize the experience for users by allowing app developers and OTT players to work with access providers in such a way that they can allocate bandwidth for more personalized and innovative services without forcing operators to eat the costs of enabling it to happen,”

All from the point of view of the vendors in this space, of course .. !

Related posts:

• Skype: We Will Charge 3G Calls to Ensure QoS Stays High (Net Neutrality?) - here
• Skype to EU Carriers: "The Network is not Yours" - here
• Dish Networks Fights for Net Neutrality - here
• Plans for a New Forum: Broadband Internet Technical Advisory Group - here
• Google's Vint Cerf on Net Neutrality - Good for the Rich Content Providers? - here 

Analysys Mason Forecasts: "Overall policy management market will grow from $876M in 2008 to $2.62B in 2013"

 

In a presentation during the Billing and OSS World 2010 (June 9-11, Washington DC), Patrick Kelly, Research Director, Analysys Mason provided a review of the policy management market. The presentation addresses the deployment of policy management solutions both in fixed (DSL, Cable) and mobile networks.

In the recent months most discussions were about mobile deployments (based on 3GPP PCRF standards) but the fixed side is very significant as well.

"Policy management software systems will evolve from single function to multi-function solutions that support subscriber management, policy and charging control, and class of service.

Analysys Mason forecasts that the overall policy management market will grow from $876M in 2008 to $2.62B in 2013 at a CAGR of 27%".

See "Policy Management Market Evolution and Deployment Scenarios" - here.

I am not sure what is included in Kelly's market size actual and forecast, as the numbers for '08 and '09 seem rather large, even if I somehow include proprietary policy products offered by the big TEMs or even add the whole DPI market.

If we look at the major policy players like Bridgewater Systems and Camiant (now part of Tekelec, they sold policy management products for less than $10M each at '08 (see "Camiant Information Exposed (and Compared to Bridgewater)" - here).

The presentation also shows some deployment scenarios of policy servers with DPI (in fixed and mobile networks), and predicts that the ultimate deployment will be such "that policy enforcement functions will be embedded into the switching and router infrastructure and the policy management systems will span the entire infrastructure to address the needs of application aware network access and differentiated service management ".

Related posts:

• "Policy Server Market - Still Small, but Always Optimistic!" - here - where Infonetics estimates the market "to reach $1.4 billion by 2014", vs. S2.6B by Analysys Mason.
   
• "PCRF - DPI Compatibility Matrix" - here - has a list of 20 policy server vendors.

Verizon Confirms: Tiered Pricing for LTE Data [but does not say what are the tiers]

Verizon Wireless CEO, Lowell McAdam, said that "the introduction of its LTE network later this year will see the company introduce tiered data plans" and "made it clear that the tiered pricing won’t be as expensive as it sounds" 

Not only that it wont be expensive - "Thanks to the efficiency of LTE, Verizon’s cost per megabyte will be approximately one-third of what they are today. .. LTE will offer further savings to customers, as he expects that all calls made come 2012 will be done via VoIP as opposed to its CDMA network"

Great progress to consumer ethics - the vendor exposes its costs!

See "Verizon confirms tiered pricing for LTE data" - here.

For the VoIP part - Verizon was indeed a pioneer in this highly sensitive space, when it partnered with Skype to provide VoIP, and possibly cannibalize its voice minutes revenues (see "Verizon likes Skype" - here). They may have also seen the recent recommendation from F&S (See "Frost & Sullivan: Mobile Operators Should not Impose Bans or Surcharges to VoIP - here - expecting to see $30B revenues for VoIP over mobile, by 2015, globally).

So what does McAdam mean by "tiered data plans" ?

Just having more volume caps (Verizon has caps today)? maybe they mean a more complex offering that will include QoS aspects (“business class service”) for the Skype/VoIP (compensate somehow for the lost voice revenues), Over the Top Video, on-line gaming, M2M ...

QoS is not necessarily about the volume or speed of data, but aboput setting the priority of traffic in the loaded (if not congested) radio, backhaul, core and peering links. Could this is the reason for using Camiant's (now Tekelec) policy server? (See "Verizon Wireless Selects Camiant for PCRF" - here).

Cisco Needs a Policy Server - Is it going to be Bridgewater, Openet or Someone Else?

 

After Cisco acquired Starent, it was clear that the package is not complete without a policy server (or PCRF, as mobile is the hot market now). Considering the good relations Starent had with Camiant (like here), I was sure that Camiant will follow - but I guess the price was not right so Camiant now is part of Tekelec.

Lightreading is reporting today that a new research note from Avian Securities speculates that Cisco is looking at Bridgewater Systems and Openet to fill this gap.

"Industry contacts indicate that Cisco is looking at Bridgewater Systems and OPENET as possible acquisitions to round out its mobile internet portfolio," writes Catharine Trebnick, a senior research analyst at Avian. "We believe Cisco is looking at these assets to enhance their offering for 3G and 4G networks and this is in-line [with] the company's mobile video strategy."


See "Rumor: Cisco Hunts for LTE Policy Control Smarts" - here.

Of the two, Bridgewater is stronger and longer time player in Policy Management, but Openet (historically focusing on charging and billing, and newer to policy management) is a good Cisco partner (see "DPI Deployments (9): Orange France Selects Openet and Cisco for Parental Control and Tethering Prevention" - here).


Nevertheless, Cisco has additional policy-server vendor partners, and I would not rule-out the [smaller] Broadhop, with which Cisco also partners, mainly in Asia.

And there are more ... - see the list here.

The price? See analysis of Camiant acquisition price ($130M) Vs. Bridgewater - "Camiant Information Exposed (and Compared to Bridgewater)" - here.

Historically, Cisco had relations with other policy-server vendors:

• Back in 1998 Cisco acquired Class Data Systems - "software solutions enable policy-based quality of service in Internet Protocol (IP) networks" - here
   
• Later Cisco worked closely with Tazz Networks. After the Tazz' dream to be acquired by Cisco had expired, Tazz disappeared. IN 2005, Tazz was #7 in Lightreading Top10 private companies (here).

Infonetics Research: SDM will integrate with Policy Servers; Reaching $1.5B Revenue by 2014

 

Shira Levin of Infonetics Research published another report related to the Broadband Traffic Management space - this time on Subscriber Data Management (SDM) - software and services.

It follows previous reports from Infonetics - on Policy Servers (see "Policy Server Market" - here) and DPI (see "The DPI Story – Introduction" - here) - all by Ms. Levin.


Managing subscriber information goes well with DPI and policy servers, as advanced service offerings by fixed and mobile operators, such as tiered service, quota limitations and forwarding subscriber traffic to value-added services require the cooperation of all 3 elements. "As subscriber mobile data usage and quality expectations grow, the capabilities that SDM technology offers, combined with advanced policy controls and subscriber data analysis, will be essential for operators to proactively meet customer needs, manage network resources, and maintain high-quality service,” [said] Levine" 

Full press release - here.

In addition of the need for subscriber information consolidation (see quote below), the research also indicates that "Policy servers will be more tightly integrated into subscriber data management solutions offered by major equipment vendors and IT integrators, as evidenced by Tekelec’s recent acquisition of both Camiant and Blueslice" (see - "Camiant Information Exposed" - here). A good example of integrated SDM and policy server may be found also in Bridgewater Systems offering (here).

While the advanced services space is now associated more with mobile services, the research shows that the market will split ~1/3 - 2/3 between fixed and mobile segments.

"The cost of managing and maintaining multiple subscriber databases has become too much of a pain point for operators to avoid any longer, which is why the subscriber data management market is doing so well despite the economic downturn. The marketing and customer care arms of telecom operators everywhere are frustrated by the lack of a consolidated view of the subscriber, because it limits their ability to cross-sell, up-sell, create value-added services, and offer single sign-on to their customers,” notes Shira Levine"

FCC Follows Europe With Bill Shock Prevention - Vendor Offering Review

  

On March 1st the EU "Bill Shock prevention" program became effective in Europe (see "EU Helps Preventing Mobile Bill Shock" - here).

The European program requires mobile operators to allow subscribers to  limit on their data charges with a default of €50, and get a warning when 80% of the limit has been reached. This mainly applies for using data services while roaming. Sending notification could be a tricky thing - for example if sent by SMS to a device that may not support SMS and/or Email (e.g. iPad, Kindle).

Now, the FCC "seek to gather information on the feasibility of instituting usage alerts and cut-off mechanisms similar to those required under the EU regulations that would provide wireless voice, text, and data consumers in the United States" (here). Note that the FCC also target non-data services. See video below.

Nevertheless, since the FCC thinks that the EU concept is a good one, it was no surprice to see Canadian Bridgewater Systems  quick to respond - as they already implemented such systems in Europe (see the above linked post).

In a press release issued yesterday "Bridgewater Comments on FCC Consultation on Mobile Bill Shock"- here - they present their policy management solutions as capable of implementing the FCC goals.

Since regulation in Europe (and probably soon in the US) require operator to support Bill Shock Prevention, most policy-server vendors offer it (list follows), based on their policy server/PCRF products. While this is not a revenue-generation opportunity for the operators, the requirement sets the ground for implementing policy servers, making it easier to the vendors up-sell additional other solutions and functions. These solutions may include tiered services, usage-based billing, traffic management, Value-added Services management, DPI control and more.

• Camiant (now Tekelec) - Quota and EU Data Roaming Control
• Comptel - Finnish Operator DNA Implements Comptel Policy Control to Combat Bill Shock (customer win)
• FTS-Soft - Bill Shock Prevention
• HP - HP Bill Shock Prevention
• MACH - Bill Shock Prevention
• NSN - Bill shock prevention
• Openet - Openet Enables mobilkom austria to Meet EU Data Roaming Regulations (customer win)
• Openwave - A Cure for Bill Shock
• Volubill  - Bill Shock Management  

Tekelec CTO on DPI Plans

Following the acquisition of Camiant, Tekelec CTO, Vince Lesch, was interviewed to Rich Karpinski of conected planet (full story - here). He was asked about their DPI plans (which may seem like the next step in Tekelec evolution):

CP: Policy server vendors like Camiant often go to market almost side by side with a deep packet inspection, or DPI, vendor. Is that an area of interest in terms of acquisition or partnerships or are there parts of your performance monitoring portfolio of probes, etc, that provide those types of traffic inspection capabilities?

Lesch: In many ways the probes of our performance monitoring systems do have a lot of similar capabilities or can get certainly get to the visibility that a DPI box does. Those devices of course today are passive devices and don’t have policy enforcement capabilities. Certainly in the near term, our focus is on this network intelligence layer, not necessarily being in the data path or being in that control. One of the great things we liked as well about Camiant, and it’s similar to the philosophy we have, is being the neutral third-party, the Switzerland let’s say, where they are not associated with any network element but they have to interoperate with many, many network elements. That level of neutrality we think is an advantage and we’ll continue to support the interoperability partners they had. I think they had one of the largest interoperability ecosystems; that will help differentiate the product in the space moving forward against potential competitors.

See my related post, "PCRF - DPI (as PCEF) Compatibility Matrix" (here) and note that Camiant is the only PCRF vendor that has already integrated its product with all major DPI vendors (Allot. Arbor, Cisco, Procera and Sandvine).

Camiant Information Exposed (and Compared to Bridgewater)

Yesterday's announcement by Tekelec (NASDAQ:TKLC) (see "Tekelec buys Camiant" - here) and its quarterly earning call provides us with some information on Camiant, which was unavailable so far as Camiant was a private company.

During the call, Tekelec President and CEO, Frank Plastina (pictured at right), and CFO Gregory Rushsaid provided the following information on Camiant (full transcript, provided by Seeking Alpha, here):

• "Over 30 mobile and fixed service providers have selected Camiant for their policy needs. In fact, Verizon Wireless recently announced that the Camiant solutions will perform the policy function for their LTE and IMS deployments." (see "Verizon Wireless Selects Camiant for PCRF (so what happened to Bridgewater?)" - here)
   
• "Additional customers include Vodafone, Sprint, Comcast and Cox. Since it was founded, Camiant has booked over $60 million in orders .. They have deployed over 150 systems that support more than 185 million broadband subscribers ..Camiant estimates that today their solutions support 70% of all North American cable modem subscribers. Camiant's early policy deployments with Comcast became the de facto standard in the US cable space."
   
• Their work with Vodafone (see "DPI Deployments - Part3: Vodafone Hungary Case" - here - but it seems they work with additional Vodafone subsidiaries) and others is today defining policy in the 3G space and the Camiant policy solution win at Verizon Wireless will now shape the definition for LTE and IMS network deployments.
   
• "In terms of the integration [with Tekelec products] realistically, Brian, that's probably something that's going to happen in 2011 because the good news with the Camiant deal is that we're at the heart of the initial LTE deployments at Verizon Wireless. So we're not going to [swap] that."
   
• "You look at the policy space, we see reports anywhere from 20% to 25% growth in 2011 and beyond and a market size in 2011 of about $200 million to $300 million." [see "Policy Server Market - Still Small, but Always Optimistic! - here]
   
• "we're actually acquiring about $15 million of backlog from the two [Camiant and Blueslice] and we've got some deferred revenues that obviously we're going to have to flow through and not claim but there's a bunch of deferred revenue on their balance sheets as well."
   
• "But you can see [slide 17 - here] that the $20 million is what we see right now between obviously today and whenever we close the Camiant deal, which is shortly, and the rest of the year."

The last point, forecasting $20M revenues during the next 7 months for the 2 acquisitions, allows to estimate that Camiant revenues forecast for 2010 is around $26-28M and the price/sales ratio is therefore 4.6 to 5 (I assume Camiant has almost no cash today, revenues split between Camiant and Blueslice is 85/15 and there is growth in the next 7 months).

Let’s compare this to Camiant's main competitor - Bridgewater Systems (TSX:BWC) (see "Bridgewater - Strong Quarter - New Customers" - here):

• Revenues forecast for 2010 (was updated recently) is CAD$85-94M
• Cash (March 31st) at CAD$84.3
• Market cap ~223M (market close yesterday, assuming 25M shares). 
• Enterprise value - CAD$139M (looks familiar?)
• Price to 2010 revenues - 1.46 to 1.62 

Bottom line - Camiant was 3 times more expensive! Good job by Camiant management !

[update-1:Tekelec buys Camiant] PCRF - DPI (as PCEF) Compatibility Matrix

Camiant is now Tekelec ..  Congratulations to the team .. $130M !

"Tekelec Announces Agreements to Acquire Camiant and Blueslice Networks" - here.

PCRF - DPI (as PCEF) Compatibility Matrix

3GPP standards-based PCRF (Policy and Charging Rule Function) and PCEF (Policy and Charging Enforcement Function) complaint solutions got lots of attention recently. It seems that most mobile operators, when considering implementing DPI (and other service-aware network elements), will be using this architecture.

Operators are always seeking for non-proprietary solutions. This ensures flexibility when choosing vendors - either as 2nd source or when they will consider replacing the supplier. Using a standard-complaint solution does not necessarily ensure that, but it certainly helps.

In the table below I present a PCRF-DPI (acting as a PCEF) compatibility matrix by the leading DPI and most PCRF vendors. The compatibility indications are based on information found on the respective companies' web sites or press-releases.


In some cases, when a vendor shows a large TEM (such as Cisco) in his technology partners page it may be there because of other reasons, not necessarily for PCRF-DPI interoperability.

I welcome vendors’ representatives to comment and add to the table, by providing a links to official announcements.

Related posts:

• Policy Server Market - Still Small, but Always Optimistic! - here
• EU Helps Preventing Mobile Bill Shock - here
• Venezuela’s Movistar Deploys Volubill PCRF - here
   

PCRF Vendor	PCRF Product	Allot	Arbor	Cisco	Procera	Sandvine
724 (Mobixell)	X-treme Framework Platform (XF)	●		●
Bridgewater	Policy Controller/PCRF		●	●		●
Broadhop	Service Management Engine
Camiant	Multimedia Policy Engine	●	●	●	●	●
Comptel	Comptel Policy Control™
Ericsson	Service-Aware Charging and Control (SACC)
Flash Networks	POLICY MANAGER
FTS	Leap™ Policy Control	●				●
HP	HP Policy and Charging(IUM)	●
Huawei	Open Control & Charging Gateway (OCG)	●
Kabira (Tibco software)	Policy Server			●
Openet	FusionWorks™ Policy Manager			●		●
Redknee	Policy Manager (PCRF)			●
Starent (Cisco)	Policy and Charging Control
Telcordia	Telcordia® Real-Time Policy
Volubill	CONTROL-IT Policy Manager
ZTE	ZXUN RCP	●