Ericsson will acquire Vonage Holdings Corp. for $6.2 billion in a move that will expand the company’s reach in global wireless enterprise.
Vonage will give Ericsson a platform to help its customers monetize the investments in networks and unlock more capabilities of 5G. The acquisition builds on Ericsson’s acquisition of Cradlepoint in 2020, which expanded the company’s 5G enterprise portfolio.
“The core of our strategy is to build leading mobile networks through technology leadership,” said Börje Ekholm, president and CEO of Ericsson. “This provides the foundation to build an enterprise business. The acquisition of Vonage is the next step in delivering on that strategic priority.”
Vonage’s portfolio features the cloud-based Vonage Communication Platform (VCP), which includes more than 120,000 customers. VCP allows developers to embed communications such as messaging, voice and video into applications and products without back-end infrastructure or interfaces. The company also provides unified communications as a service (UCaaS) and contact center as a service (CCaaS) as part of the VCP.
Vonage’s communication platform as a service (CPaaS) segment will allow Ericsson to democratize network access by offering AP enabled communications services. The CPaaS market is expected to reach $22 billion by 2025, growing 30% annually.
Ericsson’s 5G technology will help to develop space for open network APIs, which is expected to reach at least $8 billion by the end of the decade.
On completion of the transaction, Vonage will become a wholly owned subsidiary of Ericsson and will continue to operate under its existing name.