Cisco to Buy Intucell for $475 Million

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Cisco has announced that it plans to purchase Intucell for $475 million in cash and retention incentives. Based in Israel, Intucell sells self-optimizing network (SON) software that helps wireless carriers manage their networks.

All Things D’s Arik Hesseldahl reported, “Networking giant Cisco Systems said today it will spend $475 million to acquire Intucell, an Israel-based wireless technology company. Intucell was founded in 2008 and is backed by about $6 million in venture capital investments from Bessemer Venture Partners. It specializes in enabling wireless cell towers to communicate with each other, and uses software to expand and shrink their wireless cells on a real-time, as needed basis to avoid service disruptions for users in where wireless phone traffic is crowded. It also allows wireless networks to repair themselves.”

Nathan Eddy from eWeek added, “Under the terms of the agreement, Cisco will pay approximately $475 million in cash and retention-based incentives to acquire the entire business and operations of Intucell. Upon the close of the acquisition, Intucell employees will be integrated into Cisco’s Service Provider Mobility Group, reporting to Shailesh Shukla, vice president and general manager of the software and applications group.”

TechCrunch’s Josh Constine explained, “Intucell’s technology helps mobile carriers dynamically adjust their cellular grid to maximize mobile traffic speeds and minimize dropped calls. Without SON software, a carrier’s service slows down and becomes less stable under heavy load or when users travel to the edge of a geographic block of the static grid. Any optimization had to happen manually, which was inefficient and inadequate. Intucell’s SON uses big data to assess the state of a network and lets a carrier’s towers communicate with each other. That way they can expand or contract their cells in real-time so customers on the fringes of a block get picked up by neighboring towers, and users in the center of that block get much better reception.”

Bloomberg BusinessWeek’s Nick Turner observed, “The acquisition is part of an effort to get more revenue from wireless carriers, which are stepping up their capital spending to handle more traffic. Smartphones, tablets and other mobile devices have increased congestion, boosting demand for services that help fine-tune networks.”