Convergencia Research, Consultoría especializada en Latinoamérica y Caribe
Tuesday, March 31, 2020

Ribbon focuses its 2020 on the integration of ECI and the new demand curves generated by the pandemic

In an interview with Convergencialatina, Kevin Riley, CTO and Executive VP of Advanced R&D of the company, spoke of the recent purchase of ECI Telecoms Group, which moves Ribbon "next to the data on infrastructure". In the current situation due to the coronavirus crisis, the demand for voice infrastructure and capabilities of SBC and Unified Communications as a Service increased.

In November 2019, Ribbon announced the acquisition of ECI Telecom Group, a global provider of end-to-end package optical transport and SDN/NFV, for 32.5 million shares of Ribbon and US$324 million in cash. In this way, a company with annual revenues of more than US 900 million (based on Combined FYE 2018 data of Ribbon and ECI) and 4,000 employees was established. In 2020, prior to the coronavirus outbreak, it was primarily dedicated to integration, which as Kevin Riley, CTO and Executive VP of Advanced R&D at Ribbon highlighted, moves the firm beyond voice to "the infrastructure side of data".

Convergencialatina: What are the main work areas in the ECI integration process? 

Kevin Riley (KR): The purchase closed in early March, in the same week that new CEO Bruce McClelland joined the company. We came from acquiring two other companies in the communications area (Edgewater and Anova Data), but we wanted to expand to the data segment, because 5G will be an accelerator of investment in infrastructure. We are moving to the data side of the infrastructure, and this gives us a comprehensive offering of voice Unified Communications (UC) infrastructure and data infrastructure. It expands our base. The optical package segment will benefit from the high demand for fiber from the development of 5G. On the other hand, we have made investments in analytics and machine learning, which also strengthen us on that "data side".

ECI was focused on Europe, Israel and Asia-Pacific, except Japan. Its participation was low in the United States and Japan, markets in which Ribbon has a large presence. So during 2020 we want to present its products in these countries and expand its sales.

Convergencialatina: How will the appointment of Bruce McClelland as CEO contribute to this phase?

KR: He has experience in large companies, and was in charge of large integrations from ARRIS, so he will be important for the integration of ECI in Ribbon, and he is a strong technologist focused on business outcomes which will help Ribbon shape it’s go forward strategy to align with our customer critical initiatives.

Convergencialatina: What was the initial impact of the coronavirus crisis on Ribbon's operations?

KR: We can distinguish three dimensions: employees, supply chain, and customers. As for our staff, as a communications company, we have been widely using UC, platforms such as Microsoft Teams. We proclaim the UC vision over IP and put it into practice. We are a highly distributed company in the world, and our employees comfortably use UC, so we were well equipped to work at home. 85% of our staff are doing remote work and the rest are in the offices for the maintenance of the IT infrastructure.

Second, our supply chain had minimal impact against the closure of factories in China, so we were able to maintain business continuity, without interruptions in the delivery of products and services. 

Finally, from our clients -either telcos or OTT players -, there is a strong increase in demand. Both from more voice infrastructure and capacity of Session Border Controllers (SBC), as well as from our UC-as-a-Service Kandy, due to a greater number of users accessing the solution. So we see two separate demand curves, accompanied by a trend of providers to offer free access and promotions. Many of these companies are not worrying about getting money right now, but just providing free access and simply meeting demand.

Convergencialatina: What other focuses of attention do you have for 2020?

KR: We are looking to expand the SBC business. The core infrastructure market for telcos remains stable or growing at single digits, but there are opportunities. We are well positioned in NFV, and one of the axes for 2020 is to replicate the experience we had with Verizon (it offers Ribbon's SBC-as-a-Service as part of its Virtual Network Services platform since early 2018 and uses Ribbon’s NFV SBC for VoLTE interconnect at scale). We are now making progress in this regard with two Tier-1 operators, preparing to scale implementation.

Another opportunity with telcos is automation: it is a topic that is "top of mind" in operators today, because it reduces network operational costs and in turn, as networks become more complex, they need automation. The key is to use analytics so that networks have automated lifecycles.

In 2020, everything we do in networks will seek to promote automation and analytics throughout the life cycle of solutions, to make operation easier. 

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