Acme Packet, the iPhone 5, and the End of Telecom
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session orientation for valuable things like communication and trusted exchanges of transactions. That will require an end-to-end signaling system,” MeLampy says. “It could be SIP [the Session Initiation Protocol that Acme Packet is based on], it could be something else. I don’t think you can do it on a packet-by-packet basis.” Furthermore, people using voice over LTE from carriers “may start using it for other sessions that need identity and trust,” he says. “So the session orientation might become a bigger part of the Internet than people think.” At the same time, he emphasizes, “We do what we do without any change to the Internet.”
Another big shift has to do with the center of power in mobile infrastructure and equipment. “I actually see the demise of the European network equipment vendors,” Ory says. “We’re seeing more valuable business relationships in Asia-Pac. The center of gravity is moving away from Europe and to Asia for large communication manufacturers.” (European carriers are still big customers for Acme Packet, as noted in this Seeking Alpha report.)
This could have a major impact on the industry—and the world’s economies. “When Pat and I started the business 12 years ago, the people you wanted to partner with were Alcatel, Lucent, Ericsson, Nokia, Siemens,” he says. But now it’s large Asian companies like NEC, Samsung, Huawei, and ZTE.
Interestingly, those last two companies were singled out as national security threats by the U.S. government last month. And Huawei, now the world’s largest telecom equipment manufacturer, actually competes with Acme Packet for carrier business. Meanwhile, Chelmsford, MA-based Sycamore Networks, a former high-flyer that competed with some of the above providers, is shutting down.
“I don’t know what it’s going to do to Europe over the next 10, 20 years, but those companies employ a lot of people. They do a lot of R&D, and that’s where the spinoffs would come from,” Ory says. “As those companies start to contract and as the center of power moves into Asia, that’s going to have longer-term ramifications.”