Monday, September 12, 2011

Openwave CEO replaced - Consolidations to come in the traffic management market

Openwave announced today the resignation of its CEO, Ken Denman, quoting personal reasons. Denman is being replaced by Anne Brennan, the company's CFO.

As we have seen in a previous post, Openwave has been struggling for a while to deliver on the expectations it has raised in the market to provide an integrated traffic management solution for video.

After failing to show the results on over 40 announced trials, after failing to upsell their installed base with their next generation of products, after after buying back old patents and suing RIM and Apple, Openwave sees its CEO resign and, the same day,  is nominating Peter Feld as Chairman of the Board, replacing Charles E. Levine.

This market segment, born from the ashes of the wap gateway market, sees companies like Acision, Bytemobile, Comverse,  Ericsson, Flash Networks, Huawei, Mobixell, Nokia Siemens Networks, and others become the intelligent gateway in the network. That gateway's role is to complement and orchestrate DPI, charging, PCRF, video optimization. It is a key network function.

As most data traffic is browsing related, companies that used to sell wap gateway are the best positioned to capitalize on upselling a richer, more sophisticated gateway that can provide means for operators to control, monetize and optimize browsing and video traffic in their network.

Openwave has not been able to negotiate that trend early enough to avoid its market share being eaten up by traditional competitors and new entrants. Additionally, as the traffic has fundamentally changed since tablets and smartphones have entered the market, key capabilities such as TCP, web and video optimization were late to appear in Openwave's roadmap and proved challenging to build rather than buy.

Mobixell started the consolidation with the acquisition of 724 solutions last year.
I bet we will see more consolidations soon.

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