Alianza snaps up softswitch vendor Metaswitch from Microsoft

Dec. 16, 2024
The cloud provider said the acquisition will enable it to help its service provider customers transition into the cloud-native and AI services market.

Alianza, which has positioned itself as a cloud communications platform for service providers, recently negotiated with Microsoft to acquire Metaswitch, a communications software provider.

The company expects to complete the acquisition in the first quarter of 2025.

A key element of the acquisition is that it will help Alianza scale its customer base.

Through Metaswitch, Alianza will have a combined customer base of over 1,000 communications service providers, including 19 of the top 20 global operators, and a comprehensive portfolio of services focused on creating a path to cloud-orchestrated, AI-powered communications.

Multiple CSP benefits

By integrating Metaswitch’s voice and communications software services, IP protocol, and engineering talent into its fold, Alianza said it provides various benefits to its provider customers:

  • Revenue Growth: Alianza will enable service providers to close the service revenue gap and monetize their network investments.
  • Deployment Flexibility: Alianza will enable CSPs to deploy modern solutions and experiences to their customers via on-premises, public, private, or hybrid cloud models.
  • Operational Simplicity: Alianza will allow service providers to consolidate complex voice operations onto a single, comprehensive operating platform.
  • Innovation Roadmap: Alianza will accelerate investments in product innovation, including AI-based capabilities, for service providers to generate new revenue and deliver greater automation and insights for end-user customers.

Rohit Mehra, group vice president of Worldwide Network and Telecommunications, IDC, said, “The combination of the Metaswitch business with Alianza brings together a deep portfolio of services and expertise with proven cloud technology and product innovation to deliver end-to-end capabilities for service providers to modernize at their own pace.”

Closing the capex, revenue gap

Alianza says the acquisition of Metaswitch enables it to prove its thesis that it can help providers close the capex and revenue gap.

According to a study Omdia developed for Alianza, “Reinventing Core Communications: Strategic Imperatives for Growth,” net global telecom revenue has stagnated, declining to $1.98 trillion in 2022 from $2 trillion in 2014 over the past decade.

However, service provider capex “skyrocketed” to $3.6 trillion during the same period. The study’s authors noted that network investments have yielded greater bandwidth capacity, but often at the cost of operational complexity and diminished margins.

Moreover, the study found that traditional providers' competitive pressures have become more dynamic.

“Prominent vendors now dominate the large enterprise segment, and cloud-only providers continue to expand service delivery over the internet, eating away at a cornerstone of the traditional telecom market,” said the study’s authors.

Following on from its 2023 report, “Future of Telcos and the Cloud: New Business Models and Paths to Growth for 2030,” Omdia revealed five business models for service providers and their cloud partners to modernize core networks: Buy-from, Marketplace, Sell-through, Side-by-Side, and Co-investment.

Omdia said that while each approach has plusses and minuses, the 2024 report recognized that the sell-through model offers the most significant “alignment to voice and UC services, with additional research detailing passive sell-through versus integrated sell-through options.”

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About the Author

Sean Buckley

Sean is responsible for establishing and executing the editorial strategies of Lightwave and Broadband Technology Report across their websites, email newsletters, events, and other information products.

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