{Core Analysis} advises Opera on Skyfire's acquisition

{Core Analysis} is pleased to announce that it acted as the exclusive technical advisor to Opera Software in its acquisition of Skyfire Labs.

Mountain View, California,  Oslo, Norway and Montreal, Canada — February 15, 2013

The acquisition price includes a mix of cash and stock, with an upfront consideration of US$50 million (including US$8 million of cash on the Skyfire balance sheet) and performance based earn-out payments over three years, including US$26 million in cash held in escrow and funded upfront, that can bring the total deal size to $155 million.

The Opera acquisition of Skyfire is expected to close before March 15, 2013.

Skyfire, headquartered in Mountain View, California,allows mobile operators to leverage cloud computing to optimize virtually any video and other multimedia on crowded cell towers, including 3G and 4G LTE networks. Rocket Optimizer on average provides mobile networks a 60 percent boost in capacity by reducing the size of video and other multimedia content as needed to fit the available bandwidth. 

Skyfire currently counts three large U.S. mobile operators as customers for its Rocket Optimizer and Skyfire Horizon solutions, and is in trials with ten other operators around the world.

“Opera and Skyfire are a natural fit,” said Lars Boilesen, CEO, Opera Software. “Both companies have evolved far beyond their browser roots. Skyfire adds capabilities to our portfolio around video, app optimization, smartphones and tablets, and strength in North America. With video expected to consume over two-thirds of global mobile bandwidth by 2015, and as time spent on Android and iOS apps explodes, we are excited to extend Opera’s solutions for operators.”

“Opera practically invented cloud compression to improve mobile user experience, and the team at Skyfire is proud to join forces and advance cloud solutions together,” said Jeffrey Glueck, CEO of Skyfire. “Opera’s over 100 carrier relationships, global sales team, and delivery organization can accelerate the global commercialization of Skyfire’s technology. Opera´s Mediaworks advertising unit with AdMarvel, Mobile Theory and 4th Screen Advertising will strengthen Skyfire Horizon by offering mobile operators a complete turnkey solution including ad optimization, ad sales, and rich analytics. The synergies across all the product lines for both companies are tremendous.”

“The market opportunity for video/media optimization solutions geared towards operators and consumers is significant. After a thorough evaluation of this market, we strongly believe Skyfire is the clear leader for the future in this space”, said Erik Harrell, CFO/CSO of Opera.

This transaction is a proof of {Core Analysis}' market leading strategic and technological know-how in video OTT, mobile video and video optimization M&A.

For More information, please contact Patrick Lopez.

Patrick Lopez
CEO
{Core Analysis}
patrick.lopez@coreanalysis.ca

The law of the hungriest: Net neutrality and video

I was reflecting recently on net neutrality and its impact on delivering video in wireless networks. Specifically, most people I have discussed this with, seem to think that net neutrality means doing nothing. No intervention from the network operator to prioritize, discriminate, throttle, reduce or suppress a type of traffic vs another, whether based on a per subscriber, location, device or service.

This strikes me as somewhat short sighted and not very cogent of how the industry operates. I wonder why net neutrality is to apply to mobile networks, but not to handset manufacturers, app providers or content providers for instance.

There has been several depictions of some handset vendors or app providers having implemented method that are harmful to networks either unwittingly or downright predatory. Some smartphone vendors, for instance implement proprietary variations of streaming protocols to grab as much capacity of the network as possible, irrespective of the encoding of the accessed video, to ensure a fast and smooth video delivery to their device...at the detriment of others. It is easy to design an app or a browser or a video service that would use as much of a network capacity as possible, irrespective of the actual need for the service to function normally, which would result for a better user experience for the person accessing the service / the app / using this device but a degraded quality of experience for everyone else.

Why is that not looked after by net neutrality regulatory committees? Why would the network provide unrestricted access to any app / device / video service and let them fight for capacity without control? Mobile networks become ruled then by the law of the hungriest and when it comes to video, it can quickly become a fight dominated by the most popular web sites, phone vendors or app providers... I think that net neutrality, if it has to happen in mobile networks must be managed and that the notion of fair access extends to all parties involved.