Cisco to Buy Starent: It’s All About Femtocells

Entities Mentioned

• AT&T
• Cisco Systems

1. 

   By Josh Adelson

   Well, it’s not all about femtocells, but it’s not unrelated to femtocells either.

   Tuesday, networking giant Cisco Systems announced they will acquire mobile infrastructure vendor Starent Networks for $2.9 billion in cash.  Starent makes networking devices that sit between mobile radio access networks (RANs) and mobile operator’s core networks.  These devices handle the ever-increasing mobile data traffic generated by smartphones and 3G-connected laptops.  Starent’s products were originally designed to connect to macro (that is, outdoor, cell-tower) RANs.  But more recently they have been evolving their product line to support femtocell connections to the core network.  Femtocells need to connect into the mobile operator’s network through a gateway-type device that routes traffic and provides security and mobility for the sessions.  Sometimes this is generically called a Femto Network Gateway, or FNG.  Starent has been one of a small number of companies developing this capability.

   Meanwhile, Cisco has become heavily involved in the femtocell market as well.  Most notably their logo appears on the 3G MicroCell that AT&T just launched.   Having Starent in their stable means they will be able to offer more parts of a femtocell solution.

   Of course, it’s more about mobile broadband than it is about femtocells per se.  Cisco’s announcement states that “Mobile Internet is at an inflection point as IP-enabled Smartphones and other connected mobile devices gain rapid acceptance”.  But as these smartphones and their demands on networks grow, femtocells are surely one of the most obvious ways for operators to respond.
   

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