WiFi hotspot provide FON Technology has been acquired by fellow Spanish company Agile Content, which provides video delivery systems. The addition of FON’s WiFi hotspot technology to Agile’s TV offering is a strategic move designed to remove the risks associated with operators running inhouse technologies.
This particular deal is an unusual breed of acquisition. A pure video technology business acquiring a WiFi business is something that, on paper, should be a natural coming together of complementary components in the video delivery chain, particularly given video’s increasing dependence on WiFi delivery. FON’s WiFi networks are dominated by video streams, to the tune of 80% traffic being taken up by video today.
FON and its technology arm, FONtech, were very prominent in the early days of the homespot trend, when broadband providers started installing home WiFi routers that had a second SSID, open for public use by nearby people, and so adopting an inside-out approach to extending the public WiFi network. For some cable operators and others, this was the basis of a WiFi-first challenge to the traditional mobile model.
But video is more central to the broadband operators’ concerns. Agile Content says it is capitalizing on the trend of outsourcing. Last year it acquired Edgeware to boost its delivery capabilities in its B2B2C offering. Throwing FON into the mix helps raise the appeal of AgileTV, its fully managed Spanish TV platform, particularly for service provider customers interested in WiFi offload and 5G content delivery.
But this isn’t the whole picture. For that, we rewind almost three years to the day to when FON made an acquisition of its own, buying WiFi management platform provider XCellAir in April 2018. This deal signaled how the money in service provider WiFi was not just in rapid roll-out but in improving the QoE those networks support.
XCellAir was founded as an inhouse project at InterDigital, and was spun out as an independent start-up in 2015. The firm developed a cloud-based platform for monitoring and managing wireless access points – WiFi and potentially cellular. It claims it can cut truck rolls by a third and customer care calls by 50% by harnessing a mixture of mesh, steering and other WiFi technologies to improve signal reliability, while also tracking and resolving network and site level issues that do arise.
The acquisition of XCellAir by FON allowed the latter to add value to carriers using a white label version of its platform, such as BT in the UK, and to move up the services stack. FONtech has been pushing increasingly hard into service management, but with many WiFi companies doing the same, it can be hard to differentiate.
FON’s last press release was issued in June 2018, so it may have been actively seeking a buyer for some time, despite its big name customer roster that includes Deutsche Telekom, which uses its WiFi management software to give a second SSID to homespots and hotspots and to optimize and troubleshoot WiFi networks.
“The agreement with FON is designed to deliver value to our customers and their end users, as well as drive growth from a business perspective as we further consolidate our position in the European TV market and telco industry,” said Hernán Scapusio, CEO of Agile Content, who boasts serving more than 50m households worldwide with competitive TV services via its operator customers.