Ericsson is acquiring Vonage, a move said to be aimed at boosting Ericsson’s capabilities to support “wireless enterprise” application development.
“Vonage gives us a platform to help our customers monetize the investments in the network,” said Börje Ekholm, Ericsson CEO, pointing to “Vonage’s strong developer ecosystem.” Vonage already has 20,000 enterprise customers globally, he noted.
The Vonage Communications Platform represents more than one million registered developers globally, Ericsson says, allowing them to embed high quality communications - including messaging, voice and video - into applications and products.
Notably, by 2025, Ericsson expects the application programming interface market will be “more than 50 percent of the global RAN market,” said Ekholm, implying global RAN market opportunity somewhere around $44 billion in 2025, according to multiple sources.
Some forecasts project a smaller market, perhaps in the $35 billion annual range by 2025. Some estimates call for only about $17 billion in global RAN revenue by 2027 or so.
Aside from providing a platform to build 4G and 5G enterprise applications (think of any enterprise application being enabled for video, voice and messaging using those mobile networks), the VCP, unified communications and communications as a service businesses represent substantial revenue upside for Ericsson, potentially.
The VCP opportunity might be collectively be much bigger than the entire global RAN infrastructure market by 2025 or so, and the API segment along might be bigger than the global RAN market in absolute terms, using the lowest available market forecast projections of less than $17 billion.
The deal will have to be approved by regulators in the first half of 2022. The plan is for Vonage to run as a subsidiary of Ericsson.
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