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News
Issue #2003 - 14 (April 2003)
(Updated Apr. 23, 2003)

ACQUISITIONS, MERGERS & AGREEMENTS

Motorola to Acquire Winphoria Networks for Next Gen Packet-based Wireless Switching

SCHAUMBURG, Ill. -- April, 2003 -- Motorola, Inc. announced it has entered into a definitive agreement to acquire Winphoria Networks, Inc., a core infrastructure provider of next generation packet based mobile switching centers for wireless networks, which Motorola plans to integrate into its Global Telecom Solutions Sector (GTSS) business unit. The completion of the acquisition is subject to customary closing and regulatory conditions and is expected to occur in the second quarter. Motorola intends to purchase the privately held company in an all cash transaction. Additional terms of the agreement were not disclosed.

The acquisition will provide Motorola with additional capability to deliver on its strategy to provide complete networks to support operators’ 2.5 Generation (2.5G) -- 3rd Generation (3G) systems worldwide. GTSS will increase its technology capability, enabling it to develop better choices for cost-effective, enhanced featured mobile switching center solutions. 

“In acquiring Winphoria, we will augment our strategic position by adding an innovative core telecom switching capability to our portfolio and by providing a competitive media gateway solution. These translate into direct benefits for our carrier customers and prospects by helping them reduce operating costs, and by offering them a software-driven switch that can be easily upgraded and enhanced at lower cost,” said Christopher B. Galvin, chairman and chief executive officer, Motorola Inc.

Adding the soft-switch will address a long-standing need in Motorola’s network infrastructure solution. It will add core functionality in a way that complements Motorola’s existing outsourced circuit-switching portfolio. Customers will still be able to make the choice to purchase traditional circuit switches based on our existing switch supplier relationships, however the addition of soft-switch technology will enable GTSS to provide less expensive, yet more versatile, switching solutions to operators as they migrate to technologies that will support integrated voice, data and video applications. 

“We believe soft-switch technology has the potential to impact the wireless networking industry,” said Adrian Nemcek, executive vice president of Motorola and president and chief executive officer of GTSS. “The acquisition of Winphoria -- and its more than 100 highly skilled associates -- will strengthen GTSS’ value proposition by enabling us to offer operators an enhanced portfolio of network systems in addition to recently announced offerings of network management services and application and integration solutions.”

"We are pleased and excited to join the Motorola GTSS unit," said Mike Champa, president and CEO of Winphoria Networks. "Our cutting-edge solutions and entrepreneurial spirit will benefit from Motorola's scale and market presence. We see this combination as the ideal way to bring our pioneering technology to the global marketplace."

Soft-switches have several significant advantages over traditional legacy circuit switches. They are particularly appealing in emerging markets and among early adopters in mature markets where operators find them an attractive option for upgrading network capacity. The efficient performance and affordability of the soft-switch, combined with the ability to support 2G and 3G networks simultaneously, is projected to dramatically increase demand so that they outnumber traditional circuit switches by 2012. 

Soft-switches require less room, less power to operate, and can be deployed much more quickly than traditional legacy circuit switches. In addition, soft-switch architectures allow rapid feature development and high core networking flexibility. For example, Winphoria’s soft-switch architecture, as it develops over time, will also allow for server-based applications such as Push-to-Talk solutions. These advantages translate into potential savings for operators including lower capital expenditures, and switch-operating costs associated with technology migration and transport costs. 

Motorola GTSS announced an OEM agreement with Winphoria in August 2002. Through that relationship the first commercial trial of the Winphoria soft-switch, branded the Motorola Soft-Switch (MSS) began in Asia. CDMA 1X network customer trials are currently underway in North America and Asia, with limited commercial introduction slated for June 2003. 

About Motorola
Motorola, Inc.  is a global leader in providing integrated communications and embedded electronic solutions. Sales in 2002 were $27.3 billion. Motorola is a global corporate citizen dedicated to ethical business practices and pioneering important technologies that make things smarter and life better for people, honored traditions that began when the company was founded 75 years ago this year. For more information, please visit: www.motorola.com.

About Winphoria Networks 
Winphoria develops a packet-based Mobile Switching Center that dramatically increases the capacity of wireless voice networks, decreases capital and operational costs, and supports both circuit and packet networks for 2G, 3G, and All-IP wireless technologies. Winphoria also develops mobile network applications like Push-to-Talk for CDMA, GSM and other wireless technologies. Winphoria is a private venture capital funded company based in Tewksbury, MA. Winphoria was founded in March 2000. For more information about Winphoria Networks, please visit http://www.winphoria.com/

Source: Motorola Press Release

MobileInfo Comments and Advisory: This appears to be the right acquisition by Motorola.

 Note: This news release may contain forward-looking statements within the meaning of section 27A of the Securities Act of 1933 and section 21E of Securities Exchange act of 1934 in USA. Similar provisions exist in other countries. There is no assurance that the stipulated plans of vendors will be implemented. MobileInfo does not warrant the authenticity of the information. Readers should take appropriate caution in developing plans utilizing these products, services and technology architectures.  All trademarks used in this summary are the property of their respective owners.


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